Freshfields and Kirkland & Ellis are advising on House of Fraser's restructuring, with Chinese retail conglomerate C.banner set to become a majority shareholder in the company.

The UK department store group has proposed a company voluntary agreement (CVA), which will include a restructuring of its store portfolio, with branch closures likely to lead to significant job losses. The retailer has 59 stores nationwide, employing 6,500 staff and 11,500 concession staff.

Freshfields is advising House of Fraser on the proposed CVA, while Kirkland is acting for the bondholders.

The restructuring will see C.banner – the owner of iconic toy store Hamleys – become the majority shareholder in the department store with a 51% stake. The Chinese company will also subscribe for new shares in House of Fraser to provide fresh capital.

C.banner acquired Hamleys for £100m in 2015, with Linklaters corporate partner Simon Branigan leading the firm's team advising the Chinese company and Shoosmiths acting for the sellers, France's Ludendo, with a team lead by national private equity head Sean Wright.

Linklaters declined to comment on whether it was advising C.banner on the House of Fraser CVA. The magic circle firm also acted for House of Fraser in 2014 when Chinese conglomerate Sanpower Group purchased an 89% stake in the store, a deal that also saw Branigan take a lead role.

Separately, Sports Direct – which holds an 11% share in House of Fraser – has launched legal proceedings against the department store at the High Court, alleging that it has been frozen out of negotiations over the proposed CVA.

RPC has a longstanding relationship with Sports Direct, and last year secured a court victory for company founder Mike Ashley after it was alleged that he had reneged on a £15m payment promised to investment banker Jeffery Blue, if Blue doubled Sports Direct's share price from £4 to £8. RPC commercial head Jeremy Drew defended Ashley, who claimed that he could not remember having made the offer as it was made during a night of heavy drinking.

The law firm declined to comment on whether it was advising on the latest legal action.

House of Fraser is the latest in a long line of household name retailers forced to restructure  amid a turbulent time for the high street, with a number of law firms picking up advisory roles. Ashurst and Travers Smith are advising on Carpetright's restructuring, while Eversheds Sutherland has been acting on the administration of electronics retailer Maplin.

US firm Kirkland has taken a lead role on the collapse of Toys R Us, advising on a CVA secured in December to keep the business running throughout Christmas, as well as the Chapter 11 bankruptcy of its US business last year.

Photo credit: James E Petts