Icelandic retail investor Baugur has sold its struggling value fashion chain MK One to Hilco, the retail restructuring company.

Baugur put the loss-making chain on the market last month as part of its strategy to focus on larger retail assets, such as Iceland, Hamleys and House of Fraser.

However, the sale will raise fears over job losses, given that Hilco is unlikely to want to keep unprofitable stores.

Baugur chief executive Gunnar Sigurdsson said: “MK One no longer fitted our portfolio and we are pleased to announce the sale.”

He added: “MK One has a strong customer base and three good brands: MK One, Sophie and Chapter.”

Baugur claimed that it had received more than 20 expressions of interest in MK One.

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