Marks and Spencer branches out in India

Troubled retailer Marks & Spencer is set to open two stores in India in a bid to take advantage of its famous brand name.

The shops, which will be run as a franchise, are due to open in New Delhi and Bombay this October.

M&S has reached an agreement with the Indian-owned, Hong Kong-based clothing company Planet Sports, which will be responsible for finding sites and running the stores.

The planned shops will be much smaller than ones in the UK at around only 8,000 square feet, and they will initially sell only clothes.

Planet Sports will take on the running costs of the franchise with clothing being supplied by M&S. If the first two outlets are successful, it is likely more will be opened in the near future.

A spokesman for M&S said: ‘‘India is a good market with good affiliation with the UK, and a lot of people know the Marks & Spencer brand.’’

The move comes six months after M&S announced plans to close its 38 stores in mainland Europe after they lost more than £100m in two years.

M&S also said today that it was close to agreeing a deal over the sale of 80 of its high street stores in the UK.

The group would not reveal which of its 300 stores were involved, but said it was in discussions with a number of bidders.

It has not been disclosed how much M&S will get through the deal, but the figure is reported to be in the region of £350m.

Any money raised through the sale, which is thought to involve M&S leasing the shops back for at least five years, would go towards the £2bn the retailer is trying to raise to return to shareholders in March next year.

A spokesman said: ‘‘We have all along said we are looking to realise capital from our property portfolio to raise money towards the £2b.’’

He added that the group was looking at a straight sale of some of its sites, as well as sale-and-lease-back deals, and securitisations.

M&S is also looking to sell its American subsidiaries clothing chain Brooks Brothers and supermarket Kings in a deal that is likely to get the group around £500m, which would also go towards paying shareholders.