Next is understood to be close to securing a £100m takeover deal for FatFace.
According to Sky News, the high street giant is understood to be finalising the terms to acquire the fashion retailer, just three years after it was taken over by its lenders.
It said the deal could be announced later this week.
Fatface’s owners are understood to have hired advisors Rothschild on its strategic options in May last year.
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The retailer trades from more than 200 shops across the UK and Ireland, as well as several sites in the US and Canada.
Earlier this week, Fatface reported its profits had tripled to £17.3m thanks to its continued investment into expanding its store estate and strengthening third-party partnerships.
If Next is successful, the fashion chain will add to Next’s growing list of retail acquisitions and cement the group as one of the most prolific buyers of rival high street fashion chains.
Next announced in September it had become the largest shareholder in Reiss after it bought out private equity firm Warburg Pincus’ interest for £128m.
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