House of Fraser may add Lillywhites sportswear units to portfolio

British department store group House of Fraser (HoF) could introduce units of London's discount athletic sportswear banner Lillywhites, owned by Sports Direct.

Sports Direct's deputy chairman and majority owner Mike Ashley has an 11 stake in HoF.

According to the Sunday Telegraph there have been talks between Sports Direct’s chief executive Dave Forsey and HoF’s chief executive Nigel Oddy. HoF has already rejected the idea of introducing Sports Direct branded shop-in-shops.

Ashley is said to also be keen to extend Sports Direct's reach overseas and has floated the idea of rolling out Lillywhites in China using HoF owner Sanpower's connections.

However, while Sanpower's owner, Yafei Yuan, is keen to add sportswear to his empire there are concerns about Lillywhites' Asian growth potential, as the majority of sportswear brands are already available at low prices in China.

Sanpower has committed to spending 25 million pounds on opening HoF shops in China over the next two years and revamping the group's existing UK stores.

Sports Direct has already used a 16 percent stake in rival department store Debenhams to introduce a number of shop-in-shops within the chain and has said that it wants to have 16 units by the middle of next year.