Investment company Baugur Group is close to acquiring value clothing chain Mk One, according to a source quoted by news agency Reuters.

The sale, which will allegedly by announced before the end of this week, is said to be worth £44 million in cash and £11m in debt.

Baugur is predicted to take a 40-50 per cent stake in MK One's equity, with the rest kept by a new management team and Icelandic bank Landsbanki.

Baugur has already acquired ladies' clothing chains Oasis, Coast and Whistles within the last 18 months.