House of Fraser has told over 1,000 suppliers it will not pay money owed before 10 August, when Sports Direct bought the chain out of administration.
Beleaguered British department store House of Fraser is cancelling all online orders and will be refunding thousands of customers potentially millions of pounds after a dispute with its warehouse operator held up deliveries.
The beleaguered retailer said it had wiped all orders that had not already been sent to customers and would be issuing refunds.
"All customers affected will receive an email in the next couple of days".
"Please accept our apologies for any inconvenience caused and thank you from everyone at House of Fraser for your patience at this time".
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A source told just-style that Ashley and his team have been working closely with various different suppliers and creditors to try and agree a way forward but said that XPO has been "completely unreasonable".
"XPO is trying to hold us to ransom", the source said. However, it is not legally bound to pay the suppliers' money owed before the transaction took place.
"My ambition is to transform House of Fraser into the Harrods of the High Street".
Earlier this week, after Ashley said he planned to keep as many stores open "as possible", analyst Jonathan Pritchard at Peel Hunt said Sports Direct was refusing to engage with City analysts over the "fascinating" deal.
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