Baugur CEO Jón Asgeir Jóhannesson has been accused of being a better dealmaker than a moneymaker. Naturally, he disagrees.

Hunched in an uncomfortable chair in Baugur's sparse London office, Jón Ásgeir Jóhannesson looks tired and unshaven.

The chief executive of the Icelandic investment group is moments from signing the biggest deal of his life but is doing his best to appear sanguine about last-second legal hitches.

The deal was due to have been signed at 4am but it is now afternoon and the stack of documents has only just been prepared for his signature, which will seal the £351m cash takeover of House of Fraser, the department store.

The Icelander curses the army of lawyers involved, muttering that deals are "simple" where he comes from. He has worked on this deal since the autumn of 2003.

The 38-year-old has kept himself busy during the three-year wait, making more than 15 other investments in British retailers, from the Hamleys toy store to the Iceland supermarket chain.

The furious pace of the acquisitions has definitively established his prowess as a dealmaker but rival retailers have cast doubt on his abilities as a shopkeeper.

The Reykjavik native has carefully rehearsed answers to questions about his skills.

"Retail is in the blood," he says, recounting his early days in Iceland when he helped build his father's store into a discount food chain. "My father has been a retailer for 50 years, his father for 45 years, so we have a long history of retail in the family."

But a review of the latest accounts filed by Baugur's UK retail subsidiaries suggests the group's excellence as a retailer is not yet fully proven.

Mr Jóhannesson has had clear success at discount food retailing, where he has his roots.

A turnround at the Iceland supermarket chain acquired two years ago for £326m produced a pre-tax profit of £88m this year compared with losses of £61m in 2005.

But there is less evidence in the accounts to support Baugur's claim to be able to sustain profit growth at its fashion chains.

This will be key to the success of House of Fraser, which the Baugur-led consortium plans to turn into a "House of Brands", filled with designer boutiques from its own stable and further afield.

The chief executive admits his talents as a fashion retailer have limitations, adding that it is inevitable things will go awry in a consumer-dependent industry. This is why he often depends on retaining management and making sure others have a stake in his deals. He is expected to keep John Coleman, House of Fraser's chief executive.

He cites Hamleys, his first public-to-private deal in the UK, as an example of how unexpected events, such as terrorist attacks, can blow sales off course. But he says the group responded swiftly to a downturn in the wake of last year's London bombings by selling Hamleys' Bear Factory and using the proceeds to pay down debt.

Despite such hiccups, he insists Baugur is seeing a return on investment of more than 30 per cent across its portfolio.

He dismisses industry claims he has taken a scattergun approach to bid targets, saying there is a clear strategy which he calls "buy and build".

"Size matters in retail," he says, citing the example of when Mosaic Fashions bought Karen Millen. Two years on, the Iceland-listed Mosaic has merged with Rubicon Retail, also backed by Baugur, to create one of the UK's biggest fashion chains.

Some observers argue that his medley of fashion labels represents a random hotch-potch of deals. Mr Jóhannesson prefers to see them as "clusters" to which he can add.

Unlike traditional private equity, Mr Jóhannesson's group has appeared less concerned with traditional exit opportunities, bringing only one asset to market with the listing of Mosaic in Iceland.

"A refinancing is just as good a way to get our money back out of a company as long as the price of credit stays low," he says.

But the executive acknowledges that Baugur would have to change its approach if global credit markets tighten and would seek more listings.

However, he says he is loath to go further afield than Scandinavia and the UK in his search for principal investments. "I don't want to spend all week sitting on a plane."

- (Financial Times service)