With bidders circling, is this the end of the line for the Moores' business dynasty?

Sir John built Littlewoods into a leading retail force. Now it's regarded as easy prey

Littlewoods, the privately owned retail empire, said yesterday that it had received "a number of unsolicited enquiries" about an acquisition of its high street stores business as it reported a return to profit.

Littlewoods would not comment on the identity of potential purchasers but Philip Green, the retail entrepreneur who has made close to £1bn from the acquisition of Bhs, is seen as one likely candidate. Venture capital groups could also be interested as could N Brown, the mail order group that made a £500m approach for the company a year ago.

One Littlewoods insider said yesterday: "The synergies would be greater with a Bhs deal than with anyone else. And he [Mr Green] made vague noises about a takeover a while ago." But Mr Green, recently linked with a deal with Woolworths, denied yesterday that he had made any approach to Littlewoods. "I haven't contacted them. I've never looked at it. At the moment I'm happy with what I'm doing."

Terry Green, the departing Bhs chief executive who is also looking for a deal, said he has not made an enquiry about Littlewoods but did not rule anything out. "I'm looking at lots of things and who knows I might look at this one as well."

However, Mr Green has a 12-month non-compete clause in his contract that would make a bid for Littlewoods difficult.

N Brown has made two bids for Littlewoods in the past 10 years but said yesterday that "there has been no further contact since talks broke down last year". GUS, which owns the Argos stores, could also be interested.

If Littlewoods decides to sell its stores it would mark another stage in the gradual dismantling of one of Britain's biggest business dynasties. Having sold its football pools operation two years ago, the sale of its shops would leave Littlewoods focused solely on its mail order operation. That too has been linked with deals with GUS and N Brown.

All the shares in the privately controlled group are held by members of the Liverpool- based Moores family who do not see eye to eye on the future of the group. The Moores' bowing out of Littlewoods would be like the Forte family losing their hotels empire and the Barings losing control of the eponymous bank following the Nick Leeson scandal.

It would also mark yet another compelling chapter in the tumultuous history of this 79-year-old Liverpool empire.

In the past 10 years this business has seen everything: boardroom intrigue, private investigators, takeover bids, management sackings, litigation and family feuds. It has been a corporate soap opera though not quite in the league of Dallas or Dynasty . It has been more like Brookside with bigger houses.

These days 40 members of the Moores family own Littlewoods shares. In the past the family has been divided on the future ownership of the business and one Littlewoods expert said yesterday that they would now be keen to do a deal. "If they could find an elegant way out of the business, they would probably take it," the insider said. "They must be considering how they can spread their investment risk."

However, the stores business may not prove to be very valuable and the family has had a tendency to feel their assets are worth more than the market will pay. The Littlewoods group reported pre-tax profits of £34.5m on sales of £1.9bn yesterday, compared with a loss of £14.5m the year before. But most of the profits are made by the mail order side of the group. The 179 high street stores, which include the 60 Index catalogue shops, make only "modest" profits on sales of £704m.

Much of the value of the business is in the freehold property, which Littlewoods say is worth £250m. Analysts say the division may be worth £250m-£300m, including the property.

If Littlewoods is broken up it would be a sad end to the once powerful group founded by the late Sir John Moores. The son of a bricklayer and a mill girl, he established the company in the North-west of England in 1923 and ran it with a ruthless style. The football pools and mail order businesses were solid and cash generative. The high street stores occupied a position in the mass-market alongside C&A and below Marks & Spencer.

Sir John died in 1993, aged 97, but none of his children seemed up to the task of succeeding him. His daughter, Lady Grantchester became the family matriarch and had a seat on the board. Peter, one of his sons, was made chairman, but performed poorly.

Beset by infighting, bid battles and poor management the financial performance of the business suffered. Other members, such as David Moores, concentrated on outside interests – a controlling shareholding in Liverpool Football Club for example.

The family brought in external management, led by Sir Desmond Pitcher. This steadied the ship for a while but disruption and scandal was just around the corner. Things reached their nadir in 1995 when the company was engulfed by a takeover bid from a former chief executive, Barry Dale.

Private detectives were hired to investigate possible fraud in the buying department. Meanwhile, the board was in turmoil with constant shake-ups. The family eventually rejected the bid and fresh management was brought in. This time it was James Ross, the former head of Cable and Wireless, who took over as chairman. He hired Barry Gibson, a former BAA director, as chief executive.

They set up the business more on plc lines and in 1997 they sold 19 of the largest Littlewoods stores to Marks & Spencer for £192m. The proceeds were returned to the family shareholders in a move which placated those in favour of a sale of the whole group.

Now, only James Suenson-Taylor, Lady Grantchester's son, sits on the board as a non-executive director. But the group has struggled to maintain management stability. Last year Mr Gibson was ousted as chief executive and replaced by Alistair McGeorge. James Ross has been succeeded as chairman by David Simons, the former Somerfield chief executive.

As the revolving door in the boardroom has continued to spin, the business has continued to struggle. It has been caught between the new breed of discounters such as Matalan, Primark and Peacocks and the clothing ranges of the supermarkets such as Asda and Tesco. Littlewoods failed to capitalise on C&A's withdrawal from the UK last year and has suffered further as a result of the revival at Bhs and Marks & Spencer. Littlewoods has found its market share being eaten away.

As Nick Bubb, a retail analyst at SG Securities, says: "The world seems to have passed them by." It is now seeking to broaden its customer base, which is mostly women over 55. It wants to appeal to women from 45 and up, with more fashionable ranges at good prices. But, analysts say, it may take a new owner to give this historic high street name any sort of a future.

OUT WITH THE OLD THE EVER CHANGING FACE OF BRITAIN'S HIGH STREET

The potential sale of the Littlewoods store chain marks yet another chapter in the changing face of the British high street. With competitors entering the market all the time, traditional names are finding it an increasing struggle to survive.

Littlewoods is by no means the only historic name to struggle. There is a long list of once famous chains that have long ceased to exist. The most recent example is C&A, the Dutch chain that shocked the sector 18 months ago when it pulled out of the UK after accumulating losses of more than £250m in five years. It closed its 109 stores, ending 75 years of trading.

Other names to have bitten the dust include shoe chains such as Freeman Hardy Willis, Lilley & Skinner, Saxone and Manfield, all part of the Sears-owned British Shoe Corporation. In fashion, Richards Shops (ex Sears), Principles for Men (ex Arcadia) and Fosters Menswear have all gone. In electricals, the plug was pulled on Rumbelows and Colorvision as chains such as Dixons and Comet cleaned up.

Just as interesting is the list of newcomers. In fashion, older names have been challenged by an explosion of competition in all areas of the market. The new breed of discounters such as Matalan, Primark and Peacocks have caused headaches for rivals. The major supermarkets such as Asda and Tesco have also been relentlessly expanding in clothing. Meanwhile, chains founded in the 1980s such as Next, from the UK, and Gap, from the US, have expanded remorselessly. From the Continent we have seen fashion brands such as Zara and Mango come in. Uniqlo, know as the cheap Gap from Japan, also entered the UK market last year.

Richard Hyman, head of the retail consultants Verdict, says: "Littlewoods probably has too many customers in the older age spectrum who are also at the lower end of the demographic scale. If you look at the consumers of today that are moving into that age bracket, they are more demanding, more fashionable and younger in their outlook than ever before.... Retailers have to adapt to consumer purchases becoming less needs-driven and more wants-driven."