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House of Fraser rejecting gift cards – what you need to know

Sports Direct announced this weekend that it has no liability to customers in possession of existing House of Fraser gift cards and vouchers. Since the announcement, Which? has seen and heard multiple reports on social media of customers not being able to process gift cards online or in store. House of Fraser social media advisors have been pointing people to it’s gift card announcement issued on its website[1] on 11 August, which provides minimal explanation and guidance.

The announcement says Sports Direct has no liability to customers in possession of existing gift cards and vouchers, but advises customers to send off gift cards for replacements.

The statement says: ‘However we encourage these customers in possession of gift cards and vouchers to send them into the House of Fraser head office at Gift Cards, 27 Baker Street, London, W1U 8AH, whereby replacements will be issued.’

How do I return my House of Fraser gift card or voucher?

We contacted House of Fraser and Sports Direct for clarity around sending gift vouchers off to be replaced because we don’t believe its announcement advice offers customers enough information. It did not address our questions, but sent us the company gift card announcement, which we were asking questions about. If you want to follow the advice issued by Sports Direct on the House of Fraser website to send your gift card off to its HQ, here are some things you should consider:

  • Take a picture and make a note of your House of Fraser gift card details before you send it off – you might need these as proof if something goes wrong
  • Make sure you include your name and return address with your gift card or voucher when you send it
  • Get proof of postage, so that you can take it up with the new Sports Direct administration if it gets lost
  • Consider paying for recorded or special delivery if you want to ensure it gets there safely, and especially if you’ve got a lot of money tied up in those vouchers
  • Don’t expect to get refunded for the cost of sending your gift voucher – if no one had bought House of Fraser out of administration, you would have had little to no chance of redeeming your voucher at all

Are the gift cards available for purchase on the House of Fraser website valid?

We asked House of Fraser and Sports Direct to confirm if the gift cards available for sale on its website were covered by the new terms and conditions, which it is yet to respond to.

When we clicked on the terms and conditions link of the Biba House of Fraser gift card listed for sale today, we were taken to the company’s gift card announcement.

This leads us to assume that any gift cards purchased from their website over the weekend or today since the announcement would also need to go through the process it has announced for all existing gift card holders. We recommend you don’t buy any House of Fraser gift cards in store or from their website until there is further clarity around their validity for use. We recommend you wait till the terms and conditions have been updated to reflect the new administration.

When we checked the website this evening, House of Fraser had removed all gift cards from sale on its website.

What happened with House of Fraser?

On 10 August EY (Ernst & Young) was appointed administrator for House of Fraser. When a company enters administration, your right on returns and exchanges will depend on what the administrator decides to do.[2] Gift cards and vouchers in an administration situation[3] are usually anywhere from tough to impossible to redeem when this happens.

But as House of Fraser has been bought, it should be business as usual for the parts of House of Fraser that have been bought.

Shortly after House of Fraser went into administration, Sports Direct announced it had purchased the struggling retailer out of administration[4].

Sports Direct, owned by billionaire Mike Ashley, acquired all of House of Fraser’s UK stores, the House of Fraser brand and all of the associated stock for GBP90m in cash.

References

  1. ^ gift card announcement issued on its website (www.houseoffraser.co.uk)
  2. ^ company enters administration (www.which.co.uk)
  3. ^ Gift cards and vouchers in an administration situation (www.which.co.uk)
  4. ^ Sports Direct announced it had purchased the struggling retailer out of administration (www.which.co.uk)

Elon Musk says he’s been talking to Saudi Arabia about taking Tesla private

After days of speculation and conflicting reports, Elon Musk has broken his silence about his plan to take Tesla private. In a Monday morning blog post, Musk explained that he has been in talks for weeks with managers of Saudi Arabia’s sovereign wealth fund to finance the massive deal, which some estimate could cost as much as £50 billion. But it’s unclear whether Musk’s explanation will mollify federal regulators, who are reportedly looking into whether his statements from last week were misleading.

Musk said that the Saudis first approached him about taking Tesla private in early 2017, but they only ramped up those talks in recent days after purchasing almost 5 percent of the company’s stock on the public markets. Musk said he took a meeting with the managing director of the fund on July 31st, where the director expressed regret that the going private talks hadn’t moved forward.

“He strongly expressed his support for funding a going private transaction for Tesla at this time,” Musk wrote. “I understood from him that no other decision makers were needed and that they were eager to proceed.”

He added, “I left the July 31st meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of getting the process moving.

This is why I referred to ‘funding secured’ in the August 7th announcement.”

Last Tuesday, Musk sent shockwaves through the market when he tweeted that he was “considering” taking Tesla private “at £420” and that he has secured the funding to do so. The stock exchange briefly halted trading on Tesla shares as investors waited for more information. In a subsequent email to employees, Musk indicated that the tweet was serious, not just a weed joke. “The reason for doing this is all about creating the environment for Tesla to operate best,” Musk wrote.

Questions swirled about whether Musk was being entirely forthcoming about the massive amount of funding needed to take Tesla private.

Frantic efforts to root out the funder (or funders) continued in the days since. The Securities and Exchange Commission reached out to the Tesla CEO for more information about what would be the largest corporate buyout in history. And rumors began circling about the possible involvement of the Saudis.

Those rumors turned out to be well-founded.

Musk said that he has stayed in communication with the Saudi’s wealth fund about the deal subsequent to the July 31st meeting and has kept Tesla’s board of directors informed throughout the process. He reiterated his desire to provide a mechanism for current Tesla shareholders to remain shareholders even after the buyout. But Musk emphasized that a privatization deal has yet to be finalized, and everything could still change.

After all, this is Elon Musk we’re talking about.

Another critical point to emphasize is that before anyone is asked to decide on going private, full details of the plan will be provided, including the proposed nature and source of the funding to be used. However, it would be premature to do so now. I continue to have discussions with the Saudi fund, and I also am having discussions with a number of other investors, which is something that I always planned to do since I would like for Tesla to continue to have a broad investor base.

It is appropriate to complete those discussions before presenting a detailed proposal to an independent board committee.

He claimed that the deal would be financed with equity rather than debt, arguing that Tesla was saddled with enough debt at the moment.

He estimated that “approximately two-thirds of shares owned by all current investors would roll over into a private Tesla.” And he dismissed reports that a buyout could cost as much as £70 billion, stating that they “dramatically overstate the actual capital raise needed.” But he did not clarify what the actual number might be.