Mike Ashley’s Frasers muscles in on Harvey Nichols sale
Mike Ashley’s Frasers Group has gatecrashed the sales process for Harvey Nichols, defying the initial objections of the luxury department store’s brand partners.
The fashion group, founded by billionaire Ashley, has successfully entered into the auction for the high-end retail group after demanding it be allowed to take part, City PM understands.
Harvey Nichols had been told by a number of long-running brand partners that they were concerned by Frasers’ interest, though it is unknown why these companies objected.
Mike Ashley’s fashion group is known for making aggressive plays to take control of rival retailers, including Debenhams and luxury bagmaker Mulberry.
Harvey Nichols, which is headquartered at its flagship Knightsbridge store, entered talks over a potential sale late last month.
‘Obliged to allow’ Frasers to bid
Sir Dickson Poon, the Hong Kong billionaire who has owned the department store chain for 35 years, had appointed advisors at FTI Consulting to examine options for the struggling firm.
The chain, known colloquially as “Harvey Nicks,” has 14 locations worldwide and was a popular haunt for popular figures including Diana, Princess of Wales, and the cast of UK sitcom Absolutely Fabulous.
But Harvey Nichols has struggled in recent years to compete with rivals Harrods and Selfridges, which has a larger store estate.
A number of brand-owners which supply the department store chain told Sky News that they would be concerned by the prospect of the firm being bought by Ashley’s Frasers.
In a letter to brand partners, seen by Sky News, a senior Harvey Nichols official wrote on Tuesday: “As of yesterday, the situation has evolved and we are now obliged to allow Frasers Group to participate in the process alongside the other interested parties.”
Armani Beauty, Nike, Polo Ralph Lauren and Cartier are among the hundreds of brands which are stocked at the department store.
Frasers eyes battle with Next
Frasers’ interest in entering the auction for Harvey Nichols could set it up for a bidding war with high street giant Next.
The FTSE 100 retail giant has been drawing up plans to make an offer for the department store, as reported by Sky News.
Frasers’ attempted swoop on Harvey Nichols is the latest in a string of attempted acquisitions made by Mike Ashley’s group in recent weeks.
The group tabled a €2bn bid for Hugo Boss last month but the German fashion house has since called on its investors to slap down the “inadequate” proposal.
Frasers’ €38 per share bid offered only a four per cent premium on Hugo Boss’ share price.
The group followed this up with a £166m offer for Australian shoe firm Accent. The group accompanied its bid for the company with a broadside against its chairman.
Harvey Nichols declined to comment. Frasers Group could not be reached for comment.