There are two views about Tim Waterstone. "He's like a sort of humanist vicar who believes that godliness and good learning go well together," said Caroline Dawnay of the literary agency PFD. "If he were to succeed, good authors would sleep easier in their beds."

Her remarks are at odds with those of a leading business figure in the book world who - asking not to be named - characterised Waterstone as someone "who has made a lot of money buying and selling the same company". He garnished his account with a few choice expletives, before concluding: "Actually, there's not much I can say about our dealings that would honour either of us."

Mostly, though, people warm to this owlish, quizzically smiling man who is back in the news after launching a bid to buy back from HMV for £280m the chain of bookshops he founded in 1982 with £6,000 redundancy money.

Waterstone is a great reader of contemporary and classic fiction, as well as poetry, and he has written three novels. Classical music is another love: he has been chairman of the Academy of Ancient Music and on the board of the London Philharmonic. He is a family man, despite three marriages, who is devoted to his children and lists "talking with his wife" as his recreation in Who's Who.

An ex-employee described him as a "jovial Presbyterian": a mixture of old-fashioned values, commercial drive and almost childish passion. His evangelism for bookselling was morally as well as financially motivated. As with Tony Blair, there is a Christian element to his ambition: he is great believer. While essentially a nice man, he has a temper, and can be dangerous when crossed.

His relationship with his own creation reads like a business thriller. WH Smith - the company that made Waterstone redundant - took a share in his baby in 1989, buying him out completely in 1993 for £47m, of which he banked £9m. In 1998 Waterstone bought the company back in a joint venture with EMI, for £300m. Waterstone's and Dillons thereupon merged with HMV record shops, and for three years Waterstone was chair of HMV Media, from whom he is now trying to buy back Waterstone's.

The thriller could also be a psychodrama. Is it all about Waterstone constantly trying to revenge himself on the corporate high street because WH Smith sacked him? In 1997 he actually tried to buy all of WH Smith, in a hostile bid - which is rapidly what his current tilt at HMV is becoming. Last time money was on the table HMV chief executive Alan Giles said he'd sell to Waterstone "over my dead body".

It is a far cry from literature but so, some say, is the average Waterstone's these days. What was extraordinary about the old company was its radical decentralisation, with key decisions made by local staff.

The literary world is sentimental about the old Waterstone's and its maker. "He was a great innovator and authors owe him a lot," said Helen Dunmore, novelist and president of the Society of Authors. "Whether or not he buys back Waterstone's, the chain is vital to authors and readers." Author Tibor Fischer said: "The original Waterstone's was the best chain of bookshops in Britain; the staff were friendly, knew their stuff and liked to have author events."

The implication is Waterstone's in its current form is not serving authors well. Publishers tell a similar tale, complaining about small margins, together with various arcane but important details to do with stocking and return policies.

Waterstone's bid has been given added spice coming at a time when the Competition Commission has provisionally given the green light for a second bid by HMV to buy rival chain Ottakar's.

Would the Return of the King, in the shape of Tim Waterstone, be better for book buyers than "Wottakar's"? Waterstone himself certainly thinks so, saying consolidation is wrong for both chains. The HMV board believes buying Ottakar's would add value for HMV shareholders and customers of both chains.

A former marketing director of Waterstone's, John Mitchinson, says a reduction not an increase in scale is what's required: "Given how dismal Waterstone's has become, Tim's bid has got to be a good thing. The company needs radical surgery, but if he's up for it ... well, he's hugely energetic."

One bestselling author said: "I sadly fear that Tim's venture is quixotic ... with supermarkets at one end and the internet at the other, the high-street chains are being crushed in a terrifying fashion."

For many Waterstone's staff Tim Waterstone is the prince over the water - coming to restore them to glory. Whether, if successful, he could face the challenge posed by Amazon is another matter.

The CV

Born Timothy John Stuart, Glasgow, May 30 1939

Educated Tonbridge school and St Catharine's Cambridge (read English)

Family life Son of a tea-planter turned broker, he has been married three times and has eight children

Career Worked for his father's tea-broking business in India (1962-64) before joining Allied Breweries; joined WH Smith (1973); founded Waterstone's (1982); was deputy chair of publisher Sinclair-Stevenson (1989-92); between 2001 and 2006 has been trying to buy back Waterstone's

Publications Three novels: Lilley & Chase; An Imperfect Marriage; A Passage of Lives (1994, 95, 96); and Swimming against the Stream (2006), an account of his business dealings