XPO Logistics axes 627 jobs at House of Fraser warehouse

XPO Logistics is axing more than 600 jobs at its House of Fraser warehouse after a dispute with the retailer's new owner.

House of Fraser collapsed into administration 10 days ago, before being snapped up by Mike Ashley's Sports Direct.

The company was bought through a so-called pre-pack administration deal, and Mr Ashley has said he will not pay creditors for debts prior to his takeover.

This has left XPO Logistics owed more than £30 million, leading to the closure of the sites it was running in Wellingborough and Milton Keynes. All online orders have also been cancelled.

GMB union, the union for logistics workers, said on Monday that 627 workers at XPO Logistics have been put into consultation.

Alan Costello, GMB organiser, said: "This is a massive blow to our members based at depots in Wellingbrough and Milton Keynes who have been left in limbo.

"It's time for Mike Ashley to show that his rescue plan for House of Fraser is not simply a plan to boost his bank balance at the expense of House of Fraser workers and our members."

Mulberry, another House of Fraser supplier, has warned its profits could take a £3 million hit due to the department store's collapse.

The up-market firm was owed about £2.4 million when House of Fraser fell into administration, and said falling sales in stores had also knocked profits.

Mr Ashley has said he will save around 47 of House of Fraser's 59 stores, and he plans to transform the retailer into the "Harrods of the high street".

XPO logistics and Sports Direct have been contacted for comment.

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