Woolworths chairman Richard North is open to discussions about selling the variety store group to Icelandic investor Baugur and entrepreneur Malcolm Walker.

Despite rejecting a£50 million offer made by Baugur and Walker, North said he is “not unwilling to talk” if Baugur’s proposals can be revised.

North told journalists: “There are solutions if they are prepared to do something sensible.”

Baugur’s initial offer was deemed unacceptable because it undervalued the Woolworths chain and would have left the group saddled with liabilities such as pension fund and lease obligations. Effectively, Woolworths would have been paying to have the retail division taken off its hands.

Last week, Woolworths named Steve Johnson as its new chief executive. North reaffirmed his belief that Johnson, who has been portrayed as a turnaround expert, has the skills to reinvigorate the Woolies chain.