Iceland Foods management is seeking financing for its bid, but has yet to choose a company, a source said

Iceland Food's management is seeking financing for its bid, but has yet to choose a company, a source said

The management of Iceland Foods is in talks with debt finance companies over its attempt to acquire total ownership of the business, but has not yet lined one up, according to a source.

Someone close to the situation confirmed that founder and current CEO Malcolm Walker and other management, who in total hold a 23% stake in the business, are seeking financing to bid for the remaining 76% owned by failed Icelandic banks Landsbanki and Glitnir.

They said: "I can confirm that finance options are being investigated."

However, he would not confirm media reports that GSO, the debt arm of finance firm Blackstone, has been chosen to finance a bid, saying the reports are "premature".

Morrisons and Asda have been touted by industry watchers as potential bidders for Iceland, while last week Sainsbury's CEO Justin King admitted the retailer would see what stores would become available if another retailer bought Iceland and was forced to offload stores because of competition concerns.

Walker only has to match the highest bid from a rival in order to secure the shares, thanks to a clause within a shareholder agreement.