House Of Fraser Chair To Quit As Float Looms
The chairman of House of Fraser, the department store chain that is seeking to join London's flotation frenzy, plans to step down if the company returns to the public markets.
Sky News understands that Don McCarthy, the retail entrepreneur who has made a fortune from investments in a string of well-known chains, would leave his role and be replaced by a new independent chairman in the event of an initial public offering.
Sources close to the company indicated that Mr McCarthy, who owns almost 20% of House of Fraser, had no desire to chair a publicly-listed company, although he could remain on the board as a non-executive director.
A former boss of Shoe Studio Group and one-time chairman of Aurum, the jewellery retailer which owns Mappin & Webb and Goldsmiths, Mr McCarthy sold several retailers to Baugur, the Icelandic investor which subsequently collapsed during the financial crisis.
The news about Mr McCarthy emerges as the upmarket retailer assesses a plan that could see it list on the London Stock Exchange as early as this June.
Mr McCarthy, John King - House of Fraser's chief executive and the former head of Matalan - and the company's advisers are understood to have met on Wednesday to discuss the flotation, although an insider indicated that no formal decisions would be taken as a result of any discussions this week.
House of Fraser had been in talks with Galeries Lafayette, a French luxury goods retailer, about a takeover, but decided that a listing was likely to create greater value for its shareholders.
The British group enjoyed strong Christmas trading, with like-for-like sales at its 61 stores up more than 7% during the three weeks to December 28 and more than 4% in the nine weeks to the same date.
Mr King denied suggestions by rivals that the narrow trading window for which the numbers were reported represented an attempt to "dress up" House of Fraser's performance.
A flotation is likely to value the company at roughly £350m, although other potential buyers are said to have continued to show interest in a takeover.
Established during the 1850s, House of Fraser was taken private in 2006 for £351m by a consortium led by Baugur alongside Mr McCarthy and Sir Tom Hunter, the entrepreneur and philanthropist.
The stake owned by Baugur is now controlled by administrators to Landsbanki, an insolvent Icelandic bank.
House of Fraser is being advised on its plans by investment bankers at Rothschild, HSBC and Numis Securities.
Banks are benefiting from a fees bonanza generated by the deluge of retailers seeking access to the public markets.
So far this week, Pets At Home and Poundland have announced listing plans, with DFS, Boohoo and Fat Face all set to follow suit.
House of Fraser declined to comment.
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