DEPARTMENT store chain Beatties has confirmed it has been approached by a potential gatecrasher to its £69.4m takeover by House of Fraser.

While Midlands-based Beatties, which has a store in Worcester, did not name the party, it is widely believed that privately-owned Debenhams is looking at its options.

Beatties, which has 12 stores, told investors it had "recently received an unsolicited approach from a third party", but added there could be no certainty that an offer for the company would result.

It said it continued to "unanimously recommend" that its shareholders vote in favour of the takeover proposal announced by House of Fraser last week.

Debenhams, which has a store on Worcester High Street, has so far refused to comment on the speculation.

The value of Beattie's freehold property could be worth as much as £40m and lead to opportunities for the kind of sale and leaseback deals that both House of Fraser and Debenhams have performed in the past.

House of Fraser, which operates from 51 sites, said the proposed acquisition provided it with around 653,000 square feet of profitable retail space.

The company said it expected to integrate Beatties during the 2006/07 financial year - a period in which there are no new stores planned.