A number of other retailers - including New Look and Primark - are understood to be interested in Littlewoods, should the rumours of a deal with Asda turn out to be unfounded. It is understood that Littlewoods' owners, Sir Frederick and Sir David Barclay, are now testing the waters to gauge the likelihood of selling the chain as an entire package. Asda has refused to comment on the reports.
Evolution analyst Nick Bubb drew close links with Littlewoods and the other big prospective acquisition bid of the weekend, Woolworths, which is thought to have been approached by private equity group Apax.
Bubb said: 'Even though£500 million would be a generous 50 per cent of sales, the Barclay brothers appear to want more than that, because the struggling chain has begun to turn around - Whoever misses out on Littlewoods will be bound to look at Woolies, whatever happens to the Apax bid story.'
The Barclay brothers paid£750 million for Littlewoods in 2002. At its last results, the retailer reported a 5 per cent rise in like-for-like sales for the six months to the end of October