Dreams founder Mike Clare is lining up a takeover of the bed specialist with a consortium including Carpetright chairman Lord Harris.

Clare has hired corporate advisory firm Zolfo Cooper to help raise funds to take back control of the company he sold to private equity house Exponent for £200m in 2008, the Daily Express reported.

Retail Week revealed in March that Clare had been mulling buying back the beds retailer.

Clare still holds a 10% stake and it is understood he is one of a number of interested parties including South African firm Steinhoff International.

Deams, which has 270 stores, is reportedly trading strongly and is expected to turn a profit next year.

If a sale cannot be concluded lenders are said to be plotting a restructure of the business after Christmas, potentially involving a debt-for-equity swap.

The retailer has suffered the loss of its chairman Steve Johnson and chief operating officer Greg Suthern in recent months.

A Dreams spokesman said: “Dreams is in constructive and supportive negotiations with its owners and lenders, with all parties committed to ensuring that it continues to provide the best possible service.”