French department store group ‘in talks to buy House of Fraser’ as it plans to grow

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FRENCH department store group Galeries Lafayette is in talks to buy its British counterpart House of Fraser, according to industry sources.

House of Fraser is said to be looking for a price tag of at least £450m.

At the same time, it is believed to be continuing with preparations for a flotation on the London Stock Exchange early next year.

The 160-year-old House of Fraser trades from 61 stores in Britain and Ireland and has annual sales of about £1.2bn.

It has spent almost a decade under private ownership, but is believed to have been considering a return to the stock market after previous attempts at a possible trade sale failed.

It made a loss before tax and exceptional items of £6.9m in the year to January 26 2013, ending the period with net debt of £157.2m and a pension deficit of £46.9m.

Facing weak consumer spending in its home market, Galeries Lafayette has begun rolling out glitzy stores in international capitals in an effort to target customers with money to spend in emerging markets.

It now has stores in Jakarta, Beijing and Dubai, and operates 65 Galeries Lafayette outlets in total, with total revenue of 2.3bm euros last year.

House of Fraser has stores
in Hull, Grimsby, Leeds, 
Sheffield, Skipton and Huddersfield.

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