Tycoons Battle It Out To Rescue Austin Reed

Austin Reed, the high street fashion retailer, could emerge from administration as soon as next week as two rival bidders battle to acquire the century-old brand.

Sky News understands that Mike Ashley, the owner of Newcastle United and controlling shareholder in Sports Direct, and Edinburgh Woollen Mill (EWM) are the two remaining contenders to buy Austin Reed.

A decision about a preferred buyer is expected to be taken by AlixPartners, the administrator, in the coming days.

Austin Reed, which has struggled to compete in a tough trading environment for years, plunged into administration a month ago, putting more than 1,000 jobs at risk.

The company, which also owns Country Casuals and Viyella, has closed dozens of stores in a restructuring aimed at shoring up its finances.

Both Mr Ashley and Philip Day, who runs EWM, are said to believe the core business has a viable future, with administrators understood to have been pleasantly surprised at the level of interest in preserving Austin Reed in its entirety.

The attempt to salvage the business comes as administrators to BHS also try to fashion a rescue plan.

Sky News revealed this week that a wealthy Portuguese family is backing a group of financiers in a bid to buy BHS, the recent history of which is the subject of an increasingly complex probe by two committees of MPs.

Sir Philip Green, BHS's former owner, will be quizzed by MPs next month about the company's pension deficit, property deals and the hundreds of millions of pounds paid in dividends to his family vehicle, Taveta Investments.

City sources say that a sale of BHS could be announced next Thursday, although a liquidation of its assets remains a possibility, with its biggest unsecured creditor, the Pension Protection Fund, pushing for a liquidator to be lined up.

Both Mr Ashley and Mr Day were also reported to have bid for BHS before turning their attention to Austin Reed.

Sources pointed out on Saturday night that a fresh bidder could yet emerge for Austin Reed, although they were confident that a sale rather than closure of the business remains the likeliest outcome.

Austin Reed operates about 155 stores, and has been trading well since it brought in AlixPartners as administrator.

Austin Reed, which has been trading for more than a century and whose famous customers in its heyday included Sir Winston Churchill and Elizabeth Taylor, had been owned for a brief period by Alteri Investors, which specialises in working with troubled retailers (Other OTC: UBGXF - news) .