Newcastle United owner Mike Ashley is preparing to sell the club to the Saudi Arabian consortium that has been seeking to buy for almost a year.

The Daily Mail says Ashley is closing the Newcastle United retail store and has made all of his staff redundant, informing them that the club's proposed new owners do not wish to keep them.

In a move that insiders say points towards a development in the £300million Saudi-led takeover, the Sports Direct-owned store is now likely to return to club control.

Both parties have been awaiting High Court arbitration since the deal's collapse last summer. The progress of that private hearing is not known.

Staff were said to be stunned when told on Monday that the St James' Park shop must be cleared by next week and that all jobs would be lost.

It is expected to remain closed for a period before being refurbished. Kit supplier Castore are set to be confirmed as the club's new official provider and the store, when reopened, will only stock their merchandise.