House of Fraser's growing appetite for purchases puts Allders into play
Tuesday 14 September 1999
House of Fraser said it noted speculation about its possible interest in other companies in the sector, including Allders. It said: "House of Fraser confirms that following the completion of its property joint venture with British Land, it has been conducting an internal review of its corporate options to further develop the business and enhance shareholder value."
The review is not complete, but a spokesman confirmed that the options could include acquisitions. He would not comment on the reported interest in Allders. Allders, which has 39 stores, also declined to comment, but it is understood it has not received any formal approach from House of Fraser.
Analysts say an alliance would be a good fit but were concerned that House of Fraser would not be able to fund the deal. One said: "It is no surprise someone is looking at Allders. It is a good business with lots of freeholds but has been looking vulnerable, with very low ratings."
He said the acquisition would be earnings enhancing, but would put pressure on House of Fraser's balance sheet. The company, whose market value is pounds 225m, could not afford a major takeover and a merger with Allders would be more likely. Discount store TJ Hughes has also been slated as a possible buyer.
In July, House of Fraser completed a property joint venture with British Land. The sale and leaseback of 15 of House of Fraser's 50 stores raised pounds 150m to refurbish 23 outlets and clear some debt.
In May Allders announced a pounds 2.6m fall in pre-tax profits to pounds 14.3m for the half to 31 March. In June it said it would close two Allders at Home stores in Rotherham and Preston.
House of Fraser said total sales for the 18 weeks to 5 June were up slightly but like-for-like sales were down by 1 per cent.
Shares in House of Fraser closed down 2.5p at 96.5p yesterday. On Friday Allders' shares jumped 15p to 154p; they rose again yesterday to 158.5p.
- 1 Rules on 5p plastic bags likely to lead to arguments at the check-out
- 2 Hulk Hogan wants to be Donald Trump's running mate in the US Presidential election
- 3 Blood Moon and Supermoon: September to bring brightest – and dimmest – full Moon of the year on same night
- 4 News agency criticised for describing Amal Clooney as 'actor's wife' in coverage of human rights trial
- 5 David De Gea to Real Madrid: Real finally get their man with £29m bid for Manchester United goalkeeper
Climate change: 2015 will be the hottest year on record 'by a mile', experts say
'Women only' train carriages: Jeremy Corbyn unveils radical move to tackle public harassment
Black holes are a passage to another universe, says Stephen Hawking
Tony Blair attacks Jeremy Corbyn's 'Alice In Wonderland' politics
Theresa May says migrants should be banned from entering the UK unless they have jobs lined up
Iain Duncan Smith 'should resign over disability benefit death figures', says Jeremy Corbyn
iJobs Money & Business
£25000 - £30000 per annum: Recruitment Genius: From modest beginnings the comp...
£35000 - £40000 per annum: Recruitment Genius: From modest beginnings the comp...
£15000 - £65000 per annum: Recruitment Genius: This is an exciting opportunity...
£18000 - £20000 per annum: Recruitment Genius: This is a fantastic opportunity...