The well known department store group today warned up to 40 of its branches could close unless it can strike a better deal on rents.

Despite being one of the best-known names on the high street, the company say's it has been losing money for years.

The Arcadia group, owned by retail magnate Sir Phillip Green, revived the brand in the mid-90s. However, he sold it last year for a token £1 to a group called Retail Acquisitions.

Since the takeover the new owners say they have been working on a turnaround plan to bring BHS back into profit and today said this would involved the proposed use of a Company Voluntary Arrangements, or CVA, to slash its rents and quit loss-making stores.

The company employs around 11,000 people and has 164 stores, including branches in Wolverhampton, Walsall, Merry Hill, Telford and Birmingham.

BHS said it also "intends to reset its cost base" - restructuring its head office and getting rid of levels of management in its stores. It is also trying to tackle its pension fund deficit.

Chief executive Darren Topp said today: "The CVA proposal that we have announced today is a necessary milestone in resetting British Home Stores to ensure its long term future as an iconic British retail brand.

Some of our stores are loss making as we are being charged rents that are too high relative to today’s market. The CVA will address this issue".