Holders of the company's bonds are gearing up to ignore a tender offer to buy in the debt by tomorrow's deadline, in the hope that the company will have to improve its terms, as it prepares for a demerger.
GUS has said that shareholders have approved the splitting of its portfolio, to create two publicly listed companies: Argos Retail Group (ARG), which will include DIY chain Homebase, and Experian.
However, the hedge funds claim the split constitutes a technical default. Although the holders of two bond issues worth£750 million have voted to accept GUS's compensation terms of up to 0.5 per cent of their face value, some holders of bonds due to mature in 2013 are holding out for better terms.
A GUS spokesman said: 'Plans for the demerger are firmly on track and cannot be affected by any bond holder action. Any holders who are concerned about the future credit profile of Experian can be repaid in full this week.'
Under the demerger plan, GUS shareholders will receive one share in each of ARG and Experian for every GUS share held. In addition, Experian is expected to issue further shares to raise about£800 million in capital.
Recently, GUS chairman Sir Victor Blank said: 'We believe this demerger will create further value for our shareholders by enabling them to invest directly in ARG and Experian, both of which have clear strategies for growth. We are delighted that our shareholders have given their support to the demerger.'
The ARG and Experian prospectuses are expected to be published on September 14. Dealings in GUS shares will be suspended on October 6, with the demerger becoming effective on October 10.