New Look is set to enter Russia through a franchise agreement with Serbian-based partner Delta.

At a board meeting yesterday, the value retailer was expected to rubber-stamp an agreement with Delta, which has extensive knowledge of the Russian retail market.

An initial investment would allow the opening of a so far undisclosed number of shops in Moscow and its hinterland during a two-year period, prior to a wider roll-out across the country.

A source close to the situation said that a delegation from New Look is preparing to visit Moscow next week to tie up final details, discuss locations and agree a firm time frame.

Michael Lemner, international director at Mim, New Look’s French operation, was recruited in 2005 to help develop the retailer internationally. He would not confirm the Delta deal, but said: “We have done quite a lot of work to identify future markets and this is ongoing. Russia is part of our discussions.”

New Look’s Russian push is the latest evidence of the continued rush by western retailers to expand their operations in Russia – principally in Moscow, St Petersburg and their surrounding regions – as the UK continues to suffer a consumer slowdown.

Christopher Green, senior economist at Russian bank VTB, said: “This is definitely a growth market. Growth is forecast at 7 per cent this year and [the annual increase in] retail spending is running at about 15 per cent at the moment.”

Other UK retailers in Russia include Debenhams, Marks & Spencer and Kingfisher-owned Castorama. Mosaic signed an agreement with FD Lab last year to open 10 standalone stores in Moscow for its Warehouse and Principles fascias.

International groups are also growing in number in the country. H&M said in February that it would set up shop in Russia next year, following in the wake of European retailers such as Ikea and C&A.