Dunnes Stores has declined to comment on reports that the world's biggest retailer, WalMart, is close to agreeing a deal to buy the supermarket group.

According to the London-based specialist magazine, Retail Week, talks between the two companies are well advanced and a deal could be agreed shortly. This is the second time that rumours of a deal between Dunnes and Asda, Wal-Mart's British chain, have surfaced.

Last November, Retail Week reported that Dunnes chief executive Margaret Heffernan met her counterpart from Asda, Mr Allan Leighton, to discuss a possible sale.

Dunnes boasts a 20 per cent share of the Irish grocery market, and also has a significant presence in the clothing sector, but faces increasing competition following the arrival of firms such as Tesco and Aldi in the Republic.