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House of Fraser and Debenhams merger 'discussed'

Sky News logo Sky News 13/09/2018
House of Fraser © PA House of Fraser

The possibility of merging Debenhams and House of Fraser has been discussed, a director of Sports Direct has said.

Sports Direct, owned by billionaire Mike Ashley, bought House of Fraser out of administration for £90m. The sports gear retailer also owns 29.7% of struggling rival Debenhams.

The outgoing Sports Direct senior non-executive director Simon Bentley, in response to reporters' questions about a possible combination of the department store chains, said: "It's been discussed."

Video: Britain's Mulberry warns on profit from House of Fraser (Reuters)

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However, Mr Bentley said Sports Direct was busy with its latest acquisition.

"If any of you had the job of handling House of Fraser right now, I think you might have your hands full, and incidentally we've also got Sports Direct," he said.

"If there's opportunities in the future then we'll be in a position to take advantage of them."

Mr Bentley later clarified his remarks.

A man walks past a House of Fraser store in Bristol, Britain, August 10, 2018. REUTERS/Hannah McKay © Reuters A man walks past a House of Fraser store in Bristol, Britain, August 10, 2018. REUTERS/Hannah McKay

"I was asked a general question about whether or not we discuss our strategic investments, and in particular Debenhams, to which I replied in the positive," he said.

"I made no mention of any merger between House of Fraser and Debenhams, nor did I intend my answer to infer that."

Before Sports Direct's annual shareholder meeting in central London, the company said Mr Bentley, who has served on the board since 2007, would not seek re-election.

The company also said its under-fire chairman Keith Hellawell was stepping down.

Gallery: House of Fraser and other big names vanishing from UK high streets (Lovemoney)

Shares in Debenhams rose more than 9% by Wednesday's close.

After the close of trade, Sports Direct released a statement, saying it had no intention of buying the rest of Debenhams.

"Further to recent press speculation in relation to Debenhams plc, Sports Direct confirms that it does not intend to make an offer to acquire the entire issued and to be issued ordinary share capital of Debenhams plc."

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