The pension fund deficit of WH Smith is understood to be the only remaining hurdle preventing Permira from making a formal takeover offer for the UK news and stationery retailer.

Sources close to the deal said that the private equity group just needs to finalise its financing arrangements, has completed eight weeks of due diligence and now needs only WH Smith's latest trading figures to make an offer which in May it indicated would be 371p a share, valuing the retailer at £940m (€1.4bn). Talks started on April 18.