House of Fraser CEO Nigel Oddy has stood down and will be leaving the department store group after the crucial Christmas trading period.
Oddy, who has been heading the company for almost two years, leaves amid rumours of tensions between House of Fraser’s Chinese owner Sanpower and its management, however this was downplayed by a company spokeswoman, according to the The Times.
“Since the acquisition, Sanpower has committed to support House of Fraser in the event that the business development plans required them and the board had requested them,” the spokeswoman told The Times.
“There is an ongoing dialogue between management and the shareholder on possible capital expenditure programmes. Since the beginning of 2015, there has been no request from the board of House of Fraser as the business is self-funding through the bond issue last year and its own cash,” she added.
Oddy was appointed to replace House of Fraser’s long-standing former CEO John King in February 2015. He has been with the company for almost ten years having joined as executive director of homewares in 2007 and was promoted to chief operating officer in 2013.
House of Fraser was acquired by Nanjing Cenbest, a subsidiary of Sanpower, in 2014. Last year it issued £175m worth of bonds on the Luxembourg Stock Exchange as part of a £300m refinancing, however due to concerns about the state of the UK retail market the bonds have dropped in value leading to aggressive American hedge funds, including Apollo Global Management, to buy up the bonds.
It is not thought Apollo’s motivation was an aggressive take-over at this stage as the bonds were bought by its trading desk – as opposed to its private equity arm – which buys and sells bonds for profit.
In September House of Fraser posted flat interim sales of £573.5m for the six months to 30 July 2016 but warned that trading had been challenging and, in the ensuing eight weeks until 24 September, sales had dropped 2%.
The group, who operates around 60 stores, has undertaken a number of significant store refurbishments since the Sanpower acquisition and next year will open its first store in China, in Nanjing.