Waterstones may be sold by its Russian owner, who has drafted in advisers to explore options.
Tycoon Alexander Mamut has called in NM Rothschild to look at a sale of Waterstones, The Sunday Times reported.
It is thought that Mamut may be attempting to raise cash following difficulties at Russian bank Otkritie, in which he is an investor.
Otkritie has been taken over by the country’s central bank following a run on deposits that began this summer.
The new management team at Otkritie is reportedly demanding cash from investors, arguing that the bank’s financial difficulties have resulted from shareholders financing business deals.
Mamut acquired Waterstones from HMV for £53m in 2011 and installed James Daunt as managing director.
Under Daunt’s leadership the bookseller’s performance has significantly improved and in February he said it was on track to deliver a second consecutive year of profitability.
Waterstones generated its first profit in five years in the year to April 2016.
Pre-tax profits were £12.9m versus a £0.9m loss the prior year. Total sales rose to £394.7m from £378m.
Waterstones has benefited from an uptick in physical book sales, changes to its margin mix and increased sales of items such as stationery.