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Billionaire retail tycoon Philip Day weighs rescue bid for House of Fraser

The billionaire owner of Edinburgh Woolen Mill could throw House of Fraser a lifeline as the troubled department store chain edges closer to collapse.
Philip Day, who also controls fashion chains Jaeger and Peacocks, is in talks with the retailer over a potential investment after China’s C.Banner pulled out of a ?70m rescue deal.
Such an offer could set up the retail tycoon for a potential takeover battle with fellow retail billionaire Mike Ashley, who is also keen to strike a deal.
The Sports Direct’s founder, who owns 11pc of House of Fraser, has approached House of Fraser with what he considered to be “better terms”, but discussions are at an early stage.
House of Fraser said it was in talks with alternative lenders and investors as it scrambles to secure a cash injection on the same timetable. Investment bank Rothschild is advising the chain on the sale process.
Mr Day has yet to lodge a formal offer for the retailer and may not proceed with a firm bid, Sky News reported.   
Billionaire retail tycoon Philip Day weighs rescue bid for House of Fraser

Philip Day, who owns retail chains, The Edinburgh Woollen Mill and Jaeger
The billionaire has been the centre of one of the country’s most colorful boardroom rows. He was lined up as the new chairman Stobart Group, but a group of investors failed to unseat the current chairman Iain Ferguson.
His interest comes after The Telegraph revealed that accountancy giant EY had been put on standby to handle the potential collapse of House of Fraser after C.Banner went cold on the deal.
C.Banner had intended to raise the money via a placing on the Hong Kong stock exchange but was forced to abandon the plan after a sharp fall in its share price in recent weeks.
The cash call had “been rendered impracticable and inadvisable”, C.Banner admitted.
EY drew up contingency plans for ­insolvency as a part of a restructuring deal with creditors agreed last month.
It is understood that senior accountants have now been put on standby by House of Fraser's lenders to handle what would be the biggest high street failure since Woolworths collapsed a decade ago with 30,000 job losses.
If a new backer cannot be found, as many as 17,000 jobs could be at risk. As well as 6,000 House of Fraser staff, about 11,000 concession workers may be under threat.
Sources said the funding shortfall at House of Fraser has raised doubts over its ability to stock its stores.
The chain had been relying on the planned C.Banner funding to stay afloat into the crucial Christmas trading period, even after it announced plans to slash costs by shutting more than half its 59 stores.
History | House of Fraser's 170-year story
Creditors initially approved the restructuring via a company voluntary arrangement (CVA).
However, a group of commercial landlords launched a legal challenge last week and prompted C.Banner to delay its investment, which was due to be exchanged for a 51pc shareholding.
In recent days credit rating agencies have labelled House of Fraser finances as “tantamount to default” and in “limited default”, further restricting its ability to borrow to pay its bills.
The company had asked to extend the maturities on its bonds and banking facilities to October 2020 in exchange for a fee of 1pc of the outstanding debt.
It prevented House of Fraser from being hit by a “liquidity crisis” on, or immediately after, July 29, when interest and ?26.1m worth of debt repayments were due.
Fears over the fate of House of Fraser will also spark concerns for the company’s pension scheme, which is worth ?120m, according to the most recent available accounts.
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