Tony Lloyd, MP for Manchester Central, said the �590m deal agreed between GUS and the Barclay brothers earlier this year was important to the city's economy.

It is hoped the buy-out will secure jobs at the firm's Manchester depot.

But the Barclay brothers' company, March UK, already owns GUS's home shopping catalogue rival Littlewoods.

The Office of Fair Trading has referred the bid to the Competition Commission.

We want to make sure we don't throw these people onto the employment scrapheap Tony Lloyd MP

Mr Lloyd said 1,100 jobs were at risk in Greater Manchester alone if the merger did not go ahead while further jobs at distribution centres across the UK could also be endangered.

He added there was no competition issue, saying: "The home shopping market isn't some hermetically sealed type of shopping where people who use catalogues only use those and nothing else.

"In fact people will go to the High Street shops, the Trafford Centre and the city centre as well as using catalogues."

Declining market

He added: "So if catalogue shopping is bad value because of the control by March UK then people will stop using the catalogues.

"Home catalogue shopping has been a declining part of the UK shopping market for some considerable time.

"What we're really talking about is not competition but reversing the downward spiral. That would interest the consumer and the employees.

"We want to make sure we don't throw these people onto the employment scraphead because that's not good for the country and, in particular, Manchester."