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Chinese rescue of Britain's House of Fraser collapses

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London (AFP)

House of Fraser, a troubled British department store chain, said Wednesday it had lost a proposed investment from the Chinese owner of Hamleys and was looking for a new rescuer.

The group, which is currently controlled by Chinese conglomerate Sanpower, said in June that it was shutting 31 of its 59 stores across Britain and Ireland, risking the loss of 6,000 jobs.

With British retailers suffering from online competition and Brexit uncertainty, House of Fraser announced the drastic restructuring after agreeing a 51-percent sale to China's C.banner International Holdings, which already owns the London toy retailer Hamleys, for £70 million (79 million euros/$92 million).

But in a statement to the Hong Kong Stock Exchange, C.banner said a slump in its own share price had rendered the transaction "impracticable and inadvisable", and so it was pulling out "with immediate effect".

In response, House of Fraser said it was "in discussions with alternative investors and is exploring options to obtain the required investment".

"Discussions are ongoing and a further announcement will be made as and when appropriate," it said.

On Monday, Sky News reported that the ailing group was in talks with retail tycoon Mike Ashley for an emergency infusion of £50 million to stave off collapse. Ashley's Sports Direct International already owns 11 percent of House of Fraser.

Stores scheduled for closure include House of Fraser's flagship outlet on London's Oxford Street, as well as its store in the capital's City finance district.

The group, whose history dates back to Glasgow in 1849, plans also to relocate its London head office to a new location to slash costs.

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