Mike Ashley, the Sports Direct tycoon and owner of Newcastle United FC, is on the brink of buying House of Fraser (HoF) in a deal that will make him the most important figure on the British high street.
Sky News can exclusively reveal that Mr Ashley is close to an agreement to buy the department store chain from EY, the accountancy firm that was appointed on Friday morning as its administrator.
A takeover of HoF by Sports Direct is likely to be announced later on Friday although it could yet fall through or see its interest trumped by another party, according to sources close to the talks.
If completed, the deal will represent a stunning coup for Mr Ashley, who has harboured a long-standing desire to move his retail empire upmarket by acquiring one of Britain's leading department store chains.
He has held an 11% stake in the business since 2014, and also owns close to 30% of Debenhams, its main rival.
Under Mr Ashley's stewardship, Sports Direct has accumulated stakes – often through complex financial instruments – in a number of British high street chains, including Debenhams and French Connection.
Sky News revealed last week that Mr Ashley was in talks about providing a rescue package to keep HoF afloat, although in recent days he had faced serious competition to buy the business from Philip Day, the billionaire behind Edinburgh Woollen Mill Group.
Details of Mr Ashley's plans for HoF, including how many of the 17,500 people who work for the company and its concession operators would keep their jobs, were unclear.
HoF's collapse into administration ended 169 years of solvent trading and turned it – at least temporarily – into the biggest high street failure for more than a decade.
Sports Direct wrote to HoF's management last month to set out the terms of a rescue deal, saying it was willing to structure a transaction on similar terms (subject to due diligence to confirm the level of investment/cash injection required) to one proposed by the Chinese owner of Hamleys.
Mr Ashley's company added that it had cash resources available for investment and the ability to support HoF in areas such as "warehousing, online sales and the running of the business generally".
After C.banner International abandoned a £70m funding deal, it left HoF needing £40m by 20 August to avoid going bust.
Bidders for the ailing department store chain were told to submit final offers for the chain on Thursday morning, with creditors working late into the night to thrash out a deal.
In a statement to the Luxembourg Stock Exchange, where House of Fraser bonds are publicly traded, Alex Williamson, its chief executive, said he was "hopeful that the current negotiations will shortly be concluded".
He added: "An acquisition of the 169-year-old retail business will see House of Fraser regain stability, certainty and financial strength."
A takeover of the business by Mr Ashley is likely to see its pension liabilities at least partly left behind with the Pension Protection Fund, the private sector-funded lifeboat, which will entail cuts to payments for some HoF pension scheme members.
However, a rescue deal by a well-capitalised business like Sports Direct will at least preserve a significant number of jobs at HoF.
More than 6,000 roles had already been earmarked to be lost as part of a controversial process which was subject to a now-settled legal challenge from some of HoF's landlords.
Mr Day's takeover proposal would have seen HoF avoiding insolvency, while Alteri Investors, a fund specialising in buying distressed retailers, also made an offer.
The tussle over HoF's fate comes amid as an unprecedented list of high street names battle to avoid collapse.
So far this year, Maplin, Poundworld and Toys R Us UK have all fallen into administration, triggering about 10,000 job losses.
Numerous other chains, including Carpetright, New Look, Mothercare and – next week – Homebase, have turned to Company Voluntary Arrangement mechanisms to raise hopes of their survival, but at the cost of thousands more jobs.
Retailers have become casualties of a tough market characterised by rising costs combined with caution among British shoppers.
HoF, one of the best-known names in the British retail industry, has been living a hand-to-mouth existence for some time, with its shareholders periodically providing it with multimillion-pound sums to enable it to pay landlords and concession operators.
Last year, it lost nearly £44m as pressure mounted on the business.
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The company is carrying hundreds of millions of pounds of debt, including a bond worth about £125m and roughly £250m of bank debt from HSBC and Industrial and Commercial Bank of China.
EY declined to comment, while Mr Ashley's spokesman could not be reached for comment.