Cerberus Capital Management, a private investment company, is reportedly working with Hilco, the US distressed debt specialist to acquire Focus DIY.
A report in today's Times says the two are in discussions about the ailing retailer.
In January, Focus called in investment bank N M Rothschild to carry out a strategic review to help shed a £280m debt mountain.
An announcement about the future of Focus is expected at the end of next week, the paper adds.