Recommendation expected imminently
Speculation is mounting that the House of Fraser board is poised to recommend a takeover bid from Icelandic investment firm Baugur.

The Baugur-led consortium comprises Scottish retail entrepreneur Tom Hunter, Icelandic investor FL Group and Kevin Stanford, who sold his stake in Karen Millen to Baugur last year.

The department store board has already indicated that it approves of a 148p a share offer, which values the company at£350 million.

Donald McCarthy is expected to become chairman of the department store chain following the completion of the deal. It is thought McCarthy will invest part of the£130 million he got in return for his stake in Rubicon Retail, which was sold to Baugur-backed Mosaic Fashions last month.

Baugur has a strong presence on the UK high street. It owns names such as Oasis, Karen Millen and Hamleys. It also has a 10 per cent stake in Woolworths and a 14 per cent holding in fashion chain French Connection.