Lanto Synge, chief executive of Mallett, said the board had been assured that the stake-building was not the prelude to a bid and that Lord Weinstock had acquired the holding as a long-term investment.
"He is a long-standing customer of ours. He likes us and enjoys our kind of business and has an eye for beautiful things," added Mr Synge.
Lord Weinstock, who remains president emeritus of GEC, acquired the stake from Harrods, which bought into Mallett when it floated on the stock market in 1987. The shareholding was formerly owned by the Sears retail group which backed the management buyout of Mallett the year before.
Mallett's main outlet is a five-storey shop in Bond Street which specialises in 18th century English furniture and glass. It also has a picture gallery. Its other shop, in nearby Davies Street, specialises in Continental furniture.
Shares in Mallett soared 20 per cent on news of the deal. Lord Weinstock acquired his holding of 4.13 million shares at 125p each.
At the close Mallett was up 22p at 122.5p. Last year it made a pre-tax profit of pounds 3.2m on sales of pounds 15m.Reuse content