Mike Ashley’s Frasers Group acquires Knightsbridge-headquartered retailer after it went into administration
The owner of Sports Direct has bought Harvey Nichols out of administration after the upmarket department store chain warned it could run out of money if it did not find new funding.
Mike Ashley’s Frasers Group said on Thursday it had bought the chain, which is headquartered at its store in Knightsbridge, for an undisclosed sum on the day it was put into administration. Harvey Nichols has 13 stores and 1,200 employees.
In total, it has five large stores – in London, Edinburgh, Birmingham, Leeds and Manchester– and a smaller one in Bristol. It trades from outlets outside the UK, in Dublin, Riyadh, Dubai, Doha, Kuwait and two in Hong Kong.
Frasers said it was acquiring the London, Edinburgh, Birmingham, Leeds and Manchester stores, but discussions over the future of the Dublin shop were “ongoing”. The franchise agreements for the overseas stores will continue under the deal.
Harvey Nichols’s restaurant in the Oxo Tower in London is not included in the deal, and is being sold off separately.
Frasers said in a statement: “Significant restructuring and integration of Harvey Nichols into the Frasers Group ecosystem will be required to create a sustainable business for the future, including a review and rationalisation of the store portfolio, organisational structure, operating model and cost base.”
Frasers bought the House of Fraser department store chain out of administration in 2018 and has since closed about 40 of its then 60 stores. The group has been building its interests in luxury fashion with the Flannels chain and large stakes in the German brand Hugo Boss and the British handbag maker Mulberry.
Ashley has bought a series of struggling premium brands in recent years after starting out with a single sports shop. He has said he would keep Harvey Nichols’s Knightsbridge and Edinburgh stores, but rebrand the four other stores – in Birmingham, Leeds, Manchester, Bristol and Dublin – as House of Fraser or Flannels.
Harvey Nichols, which was founded in 1831 as a linen shop and became the flag-bearer for 1990s chic, was put up for sale by its long-term owner Dickson Poon after failing to make a profit since the coronavirus pandemic locked out big-spending foreign tourists.
The Frasers Group chief executive, Michael Murray, said: “Harvey Nichols is an iconic British institution with significant potential, but it is clear meaningful change is needed.
“The turnaround will require tough choices, and we are prepared to make those decisions, even if that means a smaller business in the near term, to create a stronger and more sustainable Harvey Nichols for the long term.”
Julia Goddard, chief executive of Harvey Nichols, said: “I look forward to working closely with Frasers Group to build on the momentum already under way, driving sustainable growth through greater operational efficiency and enhanced infrastructure, and continued investment into customer experiences to ensure Harvey Nichols remains a distinct and relevant luxury destination for both our customers and brands.”
The Knightsbridge store opened in 1889. In the last century it was owned by Debenhams’s former owner the Burton Group, before Poon bought it in 1991 for £53m and listed it on the London Stock Exchange in 1996.
In recent years the business has suffered from increased competition from Harrods and Selfridges as well as a host of online players, while its aspirational shoppers’ budgets have come under pressure from the cost of living crisis.
It reported a loss after tax of £105m after writing off inter-company loans for the year to 29 March 2025, according to accounts published over the weekend.
The directors warned that the company was not a going concern, because it would run out of money within the next year and that it had no agreements for new funding.
The accounts said the company had received “a number of bids” to buy it, and that it was hoping to complete a deal within the next year.
The FTSE 100 retailer Next had been interested in taking over the business but sources said it was interested in taking on only one or two of Harvey Nichols’s stores so Ashley’s bid was seen as more attractive.
Ashley, the controlling shareholder in Frasers, on Friday told the Financial Times that Harvey Nichols was in a “death spiral” and that it would be a “huge challenge” to turn it around.
