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Wed 30 Mar 2016 01:46 PM

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Abu Dhabi 'poised to buy' flagship London BHS store

British retailer approved major restructuring last week, including 40 UK store closures

Abu Dhabi 'poised to buy' flagship London BHS store
A shopper enters the BHS department store in Oxford Street in London, England. (Getty Images)

Troubled British retailer BHS is in advanced talks to sell its flagship store in London to the Abu Dhabi royal family.

According to reports in the UK, Abu Dhabi is close to snapping up the 45-year lease on Oxford Street.

Local media said negotiations had “accelerated” and a deal could be announced in the coming days.

BHS last week approved a major restructuring plan – known in the UK as a company voluntary arrangement (CVA) – to prevent the company from going into administration.

Its creditors are reportedly owed nearly £517 million ($730 million), and the retailer is also struggling to fill a pension pot shortfall valued at between £250 million ($350 million) and £550 million ($770 million).

Under the CVA, more than 40 of BHS’ 160-plus stores in the UK will close within months.

The company told Arabian Business on Sunday that international BHS franchises including stores in the Middle East would be “unaffected” by the restructuring.

In January BHS was rumoured to have agreed to lease part of the Oxford Street flagship to a Polish retailer called LLP for its junior fashion brand Reserved. This deal is understood to affect just one part of the store to be bought by Abu Dhabi.

BHS has been contacted for comment on the reported deal.

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