Sports Direct Buys Department Store Frasers

LONDON, United Kingdom — Britain's Sports Direct, the sportswear group controlled by retail tycoon Mike Ashley, has agreed to buy the freehold of the Frasers department store in Glasgow for £95 million ($125.7 million), it said on Friday.

Frasers trades as part of the House of Fraser business, which Sports Direct purchased out of administration for 90 million pounds in August.

The Glasgow building is the site of the first store opened by Hugh Fraser and James Arthur, the original founders of the House of Fraser business in 1849.

Sports Direct has agreed to buy it from Glasgow City Council — the administering authority for the Strathclyde Pension Fund.

"Sports Direct intends to continue to operate the property as Frasers and will invest in the property to further elevate and enhance this iconic department store," it said, adding that the deal has saved 800 in-store jobs.

The retailer, which will fund the deal from cash resources, said completion would take place in January.

When Ashley purchased House of Fraser in August he said he would keep as many of its 58 UK stores open as possible. So far he has confirmed the future of 22.

Billionaire Ashley, who also owns English Premier League soccer club Newcastle United, said his ambition was to transform House of Fraser "into the Harrods of the high street" — a reference to the Qatari-owned luxury department store in London that was once owned by House of Fraser.

Sports Direct said on Friday the purchase of the Frasers freehold would allow it to create the "Harrods of the North".

Shares in the retailer were up 1.7 percent at 315.7 pence, valuing the business at £1.69 billion.

By James Davey; editor: Paul Sandle.