S Kumars Nationwide Ltd may buy discount fashion chain Peacocks out of administration, with a deal expected over the next week. According to Guardian, the buyer will have to pay up to 25Mn pounds for Peacocks and arrange 50Mn pounds of working capital.

S Kumars is one of the several bidders interested in Peacocks. Others include Edinburgh Woollen Mill and Pakistani textile billionaire Alshair Fiyaz, who is reported to be working with Danish private equity fund Solstra Capital Partners, according to Foxbusiness.

Peacocks was founded in Warrington in 1884 as a family-run business selling a wide range of cheap goods. The company has more than 600 stores and concessions in the UK, and 117 stores around the world.

It has been agressively expanding for the past 15 years. It also bought the Yorkshire-based retailer Bonmarche 10 years ago. During this phase, the company floated on the stock market but Richard Kirk was unhappy with the share-price the company was getting and led a management buy out, with the backing of Echelon Capital, Goldman Sachs and hedge funds including Och-Ziff and Perry Capital that own 55% of the new holding company, the company has been laden with debt, since then. The company delisted from the exchange on 1 February 2006, again becoming privately owned.

Peacocks went into administration last month after talks on restructuring part of its massive debts collapsed. It owes 750Mn pounds in total according to KPMG. It's creditors include Royal Bank of Scotland and Barclays among others.

If S Kumars succeeds in buy the retailer, it will be it's second UK based buy out. In 2009, it bought out UK based Hartmarx Corporation out of administration for a total transaction value of $119Mn.

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