The secretive Barclay twins are believed to be close to taking control of the catalogue shopping businesses owned by GUS in a deal worth up to £500m.
The brothers, who own the Littlewoods chain, are said to be hoping to tie up the controversial takeover in time for announcement with GUS's annual results this week.
Unions in the North-east of England are braced for thousands of job cuts if the Barclays are allowed to merge the two businesses, bringing GUS's Choice, Kay's and Great Universal catalogues under the same umbrella as Littlewoods.
Analysts believe the combined group would control 30 per cent of the home shopping market, which is worth some £10bn. They say the deal would inevitably be examined by the Competition Commission. It was unclear last night whether the Barclays have agreed to take upon themselves the risk that the deal is blocked, by removing regulatory approval as a condition of the purchase.
GUS wants to rid itself of the declining "agency" business, where catalogue sales are generated by local agents from their friends and which generally involve payment by instalments. It is focusing instead on catalogues from which customers buy directly. GUS - which also owns the Argos and Homebase retail chains - reports results on Wednesday which are expected to show another difficult year for its catalogue shopping operations. Sales in the second half were 8 per cent lower than the previous year and the operation has shed 250 jobs.
Sir Frederick and Sir David Barclay bought Littlewoods from the Moores family last year for £750m.
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