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House Of Fraser PLC (HOF)

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Monday 21 March, 2005

House Of Fraser PLC

Acquisition

House Of Fraser PLC
21 March 2005


FOR IMMEDIATE RELEASE

House of Fraser PLC
21 March 2005

                              House of Fraser PLC

            Acquisition of the retail business and assets of Jenners

The Board of House of Fraser PLC ("House of Fraser" or the "Group") is pleased
to announce it has reached agreement with Jenners, Princes Street, Edinburgh
Limited ("Jenners") with regard to the acquisition of the retail business and
retail assets of Jenners for a total cash consideration of £46.1 million. In
addition, House of Fraser is assuming the Jenners pension scheme and on
completion will make a cash contribution into the scheme of £3.4 million.

Jenners operates the oldest independent department store in the world, having
maintained its original position at 48 Princes Street, Edinburgh, since 1838.
The assets and liabilities of Jenners being acquired include the Jenners brand
and name, working capital, the feuhold property at Princes Street Edinburgh, the
long leasehold property at Loch Lomond Shores, the leases at Edinburgh and
Glasgow airports and the fixtures and fittings in the four stores. Jenners
currently has approximately 750 employees. Following the acquisition, all
locations will continue to operate under the Jenners name.

The Board of House of Fraser believes that the acquisition:

• further strengthens House of Fraser's position as the UK's leading
  retailer of designer brands;
• complements House of Fraser's existing Scottish stores in Glasgow
  and Edinburgh;
• provides House of Fraser with the opportunity to realise
  additional benefits from an already profitable retail business;
• in the medium term, provides a potential benefit from adding
  the Jenners storecard into House of Fraser's financial services
  arrangements; and
• will be earnings enhancing for House of Fraser in the
  first full financial year following the acquisition (see
  note 4).

In the year ended 30 January 2005, the retail business an
retail assets of Jenners generated an unaudited gross
transaction value of £49.1 million and unaudited profit before
tax and interest receivable of £2.7 million. All four branches
traded profitably last year and trading in the first six weeks
since the year end has been up 2.3% on the previous year with a
gross transaction value of £4.5 million.

The Board of House of Fraser estimates that, as at 30 January 2005,
the net assets being acquired were approximately £17.5 million, of
which the carrying value (held at depreciated historic cost) of the
feuhold on the Princes Street property was £2.5 million. The Board
of House of Fraser is considering various options to refinance the
Princes Street property on or prior to completion.

John Coleman, Chief Executive of House of Fraser, said: "House of
Fraser has a strong Scottish heritage and recognises the landmark
position of Jenners and the iconic status that the name has in
Scotland. The Princes Street store will be a valuable addition to
House of Fraser's existing store portfolio, alongside our existing
store in Edinburgh at the opposite end of Princes Street. This
transaction represents an exciting opportunity for Jenners'
employees in the enlarged group."

Robbie Douglas-Miller, Managing Director of Jenners, said: "The
directors of Jenners believe the benefits of this deal are significant
to all parties. The famous name of Jenners goes forward, there are
exciting opportunities for the staff of Jenners and Edinburgh continues
to have a premier department store operating on Princes Street."

Enquiries:

House of Fraser                                                  020 7963 2000
John Coleman, Chief Executive
David Adams, Deputy Chief Executive and Finance Director

Dresdner Kleinwort Wasserstein (Financial adviser to 
House of Fraser)                                                 020 7623 8000
Charles Batten, Managing Director
Christopher Baird, Director
Nicholas How, Vice President

Brunswick (Financial PR to House of Fraser)                      020 7404 5959
Jonathan Glass
Rupert Young

Jenners                                                          0131 260 2486
Bill Millar                                                      07900 446 890

UBS Wealth Management (Financial adviser to Jenners)             020 7567 8000
John McElroy, Managing Director

Dresdner Kleinwort Wasserstein Limited ("Dresdner Kleinwort Wasserstein"), which
is authorised and regulated by the Financial Services Authority, is acting for
House of Fraser and for no-one else in connection with the acquisition and will
not be responsible to anyone other than House of Fraser for providing the
protections afforded to customers of Dresdner Kleinwort Wasserstein, or for
affording advice in relation to the acquisition or any matters referred to
herein.

UBS AG (Wealth Management) ("UBS AG"), which is authorised and regulated by the
Financial Services Authority, is acting exclusively for Jenners and for no-one
else in connection with the Acquisition and will not be responsible to anyone
other than Jenners for providing the protections afforded to customers of UBS
AG, or for affording advice in relation to the acquisition or any other matters
referred to herein.

Notes to editors:

1. The cash consideration of £46.1 million, and the cash contribution to the
   Jenners pension scheme of £3.4 million, will be paid at completion from House 
   of Fraser's existing bank facilities. Completion of the acquisition is due on 
   5 April 2005.

2. Following the release of the Financial Reporting Standard No. 5 Application
   Note G, which redefined the measure of turnover/sales, a new measure of Gross
   Transaction Value ("GTV") was introduced that broadly equates to the historic
   sales figure.

3. The financial information on the retail business and assets of Jenners is
   extracted from the unaudited financial statements of Jenners.

4. This statement should not be taken to mean that the earnings per share for
   House of Fraser PLC will necessarily match or exceed the historical earnings 
   per share of House of Fraser PLC and no forecast is intended or implied.

Background on Jenners

Jenners, which employs approximately 750 people, operates the oldest independent
department store in the world, having maintained its original position at 48
Princes Street, Edinburgh, since 1838. Situated in the heart of Edinburgh,
Jenners comprises over one hundred different departments selling products from
international designer fashion to locally crafted Scottish goods.

The business also operates from stores at Edinburgh and Glasgow airports and
Loch Lomond Shores, the gateway to Scotland's first National Park.

For more information about Jenners, please visit www.jenners.com


Background on House of Fraser

House of Fraser is Britain's leading retailer of designer brands. The
acquisition of the Jenners business, along with recent store openings at
Croydon, Dublin and Maidstone, will increase the House of Fraser store portfolio
to 52 stores. Further openings over the next 3 years are planned for Norwich,
Belfast, High Wycombe, Chester and Bristol.

With over 150 years of retailing experience, the company was founded with
Frasers, Glasgow in 1849 by Hugh Fraser and James Arthur. House of Fraser has
grown through the acquisition of other leading store groups including Dickens
and Jones, Rackhams and Army and Navy.

The Group announced in September a joint venture with Barclaycard to manage
House of Fraser's financial services business from June 2007 for a period of 10
years.

For more information about House of Fraser PLC, please visit
www.houseoffraser.co.uk




                      This information is provided by RNS
            The company news service from the London Stock Exchange

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