Former owner in last-ditch attempt to save Woolies

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Former Woolworths chief executive Sir Geoff Mulcahy will tomorrow talk to Ardeshir Naghshineh, Woolworths' biggest shareholder before the company collapsed, over a possible 11th-hour rescue plan, which is scheduled to shut its doors for the final time in less than three weeks.

Sir Geoff, who launched a fierce broadside last week against Deloitte, the administrator, describing its handling of the process as "disgraceful", will meet with Mr Naghshineh, the property entrepreneur who owns the Centrepoint building in the West End.

A source close to the pair said: "The reality is that most people are keen to keep Woolies alive, no matter how improbable it seems at the moment. The chances of anything happening remain slim but it's worth a shot."

It is thought that Mr Naghshineh has been in discussion with the office of Lord Mandelson, the Business Secretary, to secure bailout funding for Woolworths. Conversations with banks about possible financing are also continuing.

Deloitte said last Thursday that all of Woolworths' 807 stores would cease trading by 5 January, with the loss of more than 27,000 jobs.

Some 207 stores were scheduled to close this weekend and a further 200 will shut on 30 December, another 200 on 2 January and the remaining 200 on 5 January, when the doors will close on the 99-year-old company for the last time.

Sir Geoff, who led a consortium buyout of Woolworths in 1982, said last week: "The whole thing is disgraceful. There are a lot of losers in the situation. The whole administrative process needs to be looked at as there are two businesses here that could have been made profitable."

Rumours have suggested that Deloitte, whose effort is being led by partner Neville Khan, could pocket as much as £40m from the administration, depending on the way in which it has been structured.

Deloitte has devoted 100 staff to Woolies, with some estimates suggesting that the firm could charge as much as £22,000 an hour. Mr Khan said that 500 former suppliers to Woolworths and EUK, its distribution arm, had made claims for money from the administrators.

Sources close to the administration process have suggested that the company's biggest creditor, Burdale, a subsidiary of the Bank of Ireland that, with GMAC, lent Woolworths £385m in January, had been listening to offers of 70p in the pound on its portion of the debt. A spokesman for Burdale declined to comment.

The administrator said last week it was in advanced talks to sell 300 of the company's sites, adding that there had been interest in the other 500.

The food retailer Iceland, led by Malcolm Walker, the man who tabled a £50m bid to buy Woolworths last August but was rebuffed by chairman Richard North, has agreed terms on 50 of the Woolworths stores.

Interest for the sites has also come from Asia, Africa and the Americas, Mr Khan said.