Admitting plans to buy Woolworths have been put on the back burner, speculation is rife that Iceland Foods boss Malcolm Walker is mounting a bid to buy out the business outright.

In an exclusive interview with The Grocer, Walker refused to rule out buying Icelandic-owned shares in the company and conceded there might be changes to the shareholder structure. Icelandic companies, including Baugur, own about 70% of Iceland Foods’ shares and there is speculation Walker is putting together a finance package to buy them should they become available due to the Icelandic banking crisis.

“I don’t know whether Baugur will be among the shareholders in the future – it depends how their troubles unfold,” he told The Grocer.

Walker would look to retain control of Iceland Foods, one industry insider told The Grocer. “I would be surprised if Walker doesn’t get the funding to buy out Baugur,” he said. “Iceland is a good business and there no-one could do a better job than Malcolm.”

Iceland Foods has been caught up in the controversy surrounding the future of Baugur, which has a 35% shareholding through a subsidiary called BG Holdings EHF. Baugur has also been lent money by stricken Icelandic banks Landsbanki and Glitnir – and these two are also among its shareholders.

Walker claimed the company would be unaffected by events in the country. “Iceland Foods is trading its socks off,” he said. “There’s nothing that could happen in Iceland that would cause us a problem. The credit insurers are delighted with us. We are one of their star clients.”

He added that there was no chance of any banks calling in their loans, because Iceland Foods had not defaulted on them. Sir Philip Green is reportedly in talks with the Icelandic government to buy Baugur, whose interests include House of Fraser, Whittard of Chelsea and Mosaic, as well as Iceland Foods. However, Walker said Green was unlikely to be interested in the frozen discounter business. “He is a fashion man,” said Walker.

Baugur refused to comment on Sir Philip’s discussions, claiming its financial situation was stable and none of its shares were up for sale. However, the company admitted it had a ‘shareholders pact’ that meant other shareholders were given first refusal when shares were put up for sale.

When asked about his plans to buy Woolworths, Walker replied: “That was yesterday. The world has changed in the last few weeks. This is not the time to be buying Woolworths. I would not rule it out in the future, but at the moment we have enough going on. Woolworths still has £2bn in sales and there’s a business there – but it will take a lot of money to sort it out.”