THE store chain House of Fraser is being snapped up by a Chinese conglomerate after it agreed to a deal valuing the business at more than £450 million.

Nanjing-based Sanpower has agreed terms on its purchase of an 89% stake in the 165-year-old retailer.

It puts paid to separate plans being considered to float House of Fraser on the London Stock Exchange this summer.

The department store was linked to the takeover by Sanpower - which has more than 100 businesses in mainland China - last weekend.

Chairman Don McCarthy, whose family control 20% of the company, was already believed to have accepted the offer at that point.

Other large shareholders include Icelandic banks and Scottish entrepreneur Sir Tom Hunter, with more than 10%.

House of Fraser, which generates sales of £1.2 billion a year and employs 7300 people as well as 12,000 concession staff at 61 stores, has held a protracted search for new investors.

France's Galeries Lafayette held talks with the firm until the end of January. It is also believed to have held informal takeover talks with Sports Direct tycoon Mike Ashley.

The chain, which has its origins as a small drapery store in Glasgow, first listed on the stock market in 1948, and remained a public company until it was bought by Mohamed al-Fayed in 1985.

It was listed again in 1994 before being bought in 2006 by a group of investors led by Icelandic tycoon Jon Asgeir Johannesson's Baugur Group in a £350m deal.