Woolworths seen set for new takeover talks

LONDON (Reuters) - Woolworths Group WLW.L is to meet Malcolm Walker, chief executive of food retailer Iceland, for new talks about a takeover of its retail business, newspapers reported on Sunday.

Woolworths, which has around 820 stores, was not immediately available for comment.

Walker is part of a consortium that includes Icelandic investor Baugur, which owns a 10 percent stake in Woolworths.

The consortium, which is not interested in Woolworths's EUK and 2 Entertain distribution businesses, had an approach for Woolworths' stores rejected earlier this month.

The Observer said that approach was an "opening shot" and Walker would meet Woolworths chairman Richard North in the coming week.

The Sunday Times said Walker would slash overheads and considerably narrow the product range at Woolworths, which offers sweets, toys and DVDs.

Woolworths shares, which have lost two thirds of their value over the past 12 months, closed at 7.08 pence on Friday to value the business at 105 million pounds.

Woolworths said on August 19 its board "was not unwilling to talk to Baugur" after rejecting an approach of about 50 million pounds ($93.41 million) as too low and complex.

(Reporting by Dan Lalor; editing by Elaine Hardcastle)