The Lancashire-based budget fashion retailer has debts estimated at £260m. It is understood to be in talks with banks and other investors about a £525m refinancing deal to repay the debt.
The refinancing would include a six-year loan of about £250-300m and a bond issue of £225m, according to debt information specialist CapitalStructure. The rest would be used to pay Hargreaves.
The deal, being brokered by Goldman Sachs, follows Hargreaves' unsuccessful attempts to sell the 205-store discount clothing chain. Private equity offers fell short of his £1.5bn asking price, forcing Hargreaves to pull the flotation last month.
The son of a Liverpool docker, Hargreaves left school at 14 to sell Marks & Spencer seconds from a market stall. He opened his first Matalan store in 1985 in Preston. The company floated on the London Stock Exchange in 1998.
Hargreaves is based in Monaco and has an estimated fortune of about £330m, according to the Sunday Times Rich List.
