Coats Viyella today refused to confirm reports the sale of its contract clothing business "would be completed next week" and a management buyout was "an option".

One press report said that an undisclosed bidder was in "exclusive negotiations" and Mike Hartley, chief executive of the company's Viyella division, had been linked with the bid.

But Kazia Kantor from Coats Viyella said: "We are talking to a number of interested parties. As and when one emerges as a winner, we will make an announcement."

A spokesman from Coats Viyella's PR company declined to comment further, saying Mr Hartley was out of the country.

Sources say that Coats Viyella is under pressure to make the sale quickly because Marks and Spencer is set to award contracts for its Autumn/Winter 2001 range in the next few weeks.

Last week it was revealed that Hong Kong trading company, Li & Fung, had withdrawn from talks to buy the clothing manufacturing business.

Coats Viyella announced in September that it was pulling out of the contract clothing, home furnishings and branded clothing businesses to concentrate on its global threads business.

By Deborah Bowyer