£280 million offer on the table
Waterstone's founder Tim Waterstone has offered owner HMV Group£280 million for the books chain.

If his bid is successful, the retailer will be chaired by Waterstone, with Penguin Group boss Anthony Forbes Watson as its chief executive. Bank finance for the deal has been obtained in principle.

Waterstone said: 'This is a wonderfully priced offer for a business that faces major challenges to recapture the market share and operating margins that have been lost.'

The offer is subject to HMV not buying or bidding for rival bookstore chain Ottakar's. The Competition Commission provisionally backed HMV's proposed takeover of Ottakar's last month.

Anthony Forbes Watson said: 'We believe it would be a mistake for HMV to acquire Ottakar's. Recovery at Waterstone's is a priority and the acquisition of Ottakar's would present a perilous distraction from this objective.'

Waterstone originally ended his involvement with the book chain in 2001.