Focus DIY’s owners have hired bank Lazard to consider options that could lead to a sale of the home improvement chain.

US private equity firm Cerberus is thought to have brought in Lazard to advise it on the future of Focus, according to the Observer.

Cerberus bought the chain for £1 three years ago.

The newspaper speculates that Homebase owner Home Retail Group could be a potential buyer.

In documents filed at Companies House the retailer said that it is in “significantly better” shape at the financial year’s end than at the start. Last year it negotiated a company voluntary arrangement that enabled it to shed 38 non-trading stores.

As a result the retailer was able to secure a two-year extension on its £50m overdraft. According to the Observer, that facility expires in December 2011 and Focus is in talks with its banks about refinancing.

Focus has been embarking on a brand refresh that it says has been paying off. It has been revamping its stores to its Genesis format and is also trialling new smaller stores.

The 178-store retailer reported a loss of £21m in the year to February 21. However EBITDA increased 17% to £17.7m. Turnover fell 3% to £486.9m.