Sun, 28th Jul 2019
Sports Direct says that it regrets its rescue of House of Fraser. The retailer revealed its £605 million tax bill from the Belgian authorities, as a part of its delayed financial results, and explained that in hindsight, the rescue of House of Fraser may have been a bad choice.
The company described the problems faced by House of Fraser as being nothing short of terminal. They are in talks with Belgian officials regarding the tax bill.
Sports Direct had been due to publish its full year results on the 15 July, but the results were delayed because of the uncertainty surrounding the future trading performance of the struggling high street company House of Fraser.
Mike Ashley has been trying to build himself up as a saviour of High Street chains but the decision to go on an acquisition spree may have been unwise. This year he has attempted to pick up several high street retailers, and attracted a lot of attention with his aggressive and failed bids for Debenhams. The acquisition of House of Fraser is something that the firm regrets. There were high hopes for the company at the time of the rescue, with plans to turn it into the Harrods of the High Street. Short term, the acquisition is now being treated as a mistake, but long term there are still plans to work on fixing the issues within the retailer, and rebranding it as a higher-end type of department store.