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Mike Ashley's Frasers Group has snapped up Harvey Nichols after the luxury department store warned it could run out of money if it did not find a buyer.
The retail tycoon, who launched Mike Ashley Sports in Maidenhead in 1982 before renaming it Sports Soccer in the mid-90s, will add the store to his empire.
The 195-year-old department store will join Frasers' stable of brands, including Sports Direct, Flannels, House of Fraser and Evans Cycles.
The department store chain employs 1,200 staff in the UK, who have been facing uncertainty since owner Sir Dickson Poon put the business up for sale in June.
Frasers has been keen to add luxury brands – including Hugo Boss and Gieves & Hawkes – to its stable of retailers.
Sold: Mike Ashley has bought the luxury department store
But its acquisition of online luxury marketplace Matchesfashion has sparked concerns among some of the glamorous brands stocked by Harvey Nicks as well as over future job losses.
Just three months after buying Matchesfashion in December 2023 for £52million, Frasers placed the company into administration with 273 job losses. This left designer brands, including the likes of Burberry and Gucci, owed a total of £36million.
Ashley said last week that Harvey Nicks is 'in a death spiral'.
High Street fashion chain Next withdrew its interest earlier this summer while some private equity companies were also reportedly involved in buyout talks.
In its heyday in the 90s, fans of Harvey Nicks included Princess Diana and other fashion-forward 'Sloane Rangers'.
Mary Portas, the store's young creative director, made a deal with Absolutely Fabulous where its brash and boozy fashionista characters often mentioned the store and wore its clothes.
She transformed it into a trendy destination for the 'fashion-forward' with eye-catching window displays.
But it has failed to make a profit for five years after being hit by a downturn in tourism spending following the Covid pandemic and the removal of a VAT-free shopping scheme.
The business has said prospective buyers will need to cough up as much as £60million in investment to help bring it back to its former glory.
Harvey Nichols' Knightsbridge store opened in 1889. It was bough by Poon in 1991 for £53million and was listed on the London Stock Exchange in 1996.
In total it has five large department stores. Alongside London, there is Edinburgh, Birmingham, Leeds and Manchester, which Frasers is acquiring.
It also has a smaller shop in Bristol, with outposts in Dublin, Dubai, Doha, Kuwait, Hong Kong and Riyadh.
The transaction excludes the Oxo restaurant which has been sold to another buyer.
Frasers 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.'
He added: 'By integrating Harvey Nichols into our existing luxury ecosystem, we believe Frasers Group can deliver the expertise, infrastructure and commitment needed to give the business the best chance of long-term success.'
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