Golden Week in Nanjing may have come and gone but the doors of the famed House of Fraser store in Xinjiekou remained closed throughout.
Missing out on the the biggest shopping week of the year will come as a blow to the already troubled operation. Meanwhile, right next door, business was more than brisk at the similarly well known Hamleys toy store which opened up, as promised, on 1st October.
The fact that these two historic names stand side by side on what is likely Nanjing’s most expensive piece of real estate is no coincidence, while the couple are also the very public face of a China that gone out into the world of global business with its pockets bulging.
Nanjing giant Sanpower purchased a 89 percent stake in House of Fraser for slightly shy of half a billion UK Pounds Sterling in April of 2014, a sale made possible by the flagging fortunes of the Glasgow, Scotland, based brand that had been been losing money for five consecutive years, until 2015.
At the time, the slightly eccentric founder of Sanpower, Yuan Yafei, proclaimed a new era for the department store chain, one in which he would steer it to global success, with up to 50 stores in China, and others in Russia and the Middle East.
The initial opening date was April this year. Now, the October chance has slipped them by too.
As to the reasons why the doors of House of Fraser remained shut over the Golden Week holiday, there are two versions of the truth. First, according to Sanpower, the opening has been delayed to take account of differences in the Chinese fashion calendar (so called “seasonal clothing considerations”), or that second, if sources close to House of Fraser are to be believed, that Sanpower failed to provide a promised cash injection into both House of Fraser UK and China.
Speaking with the Financial Times, the Chairman of House of Fraser, Frank Slevin, commented, “There is an ongoing dialogue between management and the shareholder on possible capital expenditure programmes but that can’t be translated as a promise”.
As well as money, there have reportedly been clashes over the style and presentation of the brand. Moreover, there could be something else going on behind those closed doors than mere shelf stacking, with further rumours abounding that the real reason for not opening up is because the brand is already up for sale again.
While the 256-year-old UK toy shop Hamleys was acquired by CBanner International, but only after Sanpower pulled out of a possible deal, as a result paying to then French owner Ludendoa a break free fee of £15 million, it is CBanner that may end up with a majority stake in House of Fraser.
