British retail billionaire Philip Green is in advanced talks with a U.S. private equity firm over the sale of a 25 percent stake in high street chain Topshop and Topman, a source familiar with the matter told Reuters.
The deal, reported earlier by Sky News, is not yet finalized but an announcement could come as soon as Thursday, the source said.
The stake would be ring fenced from Green’s larger Arcadia Group, which includes high street names such as BHS, Burton and Miss Selfridge, and could value the two chains at close to 1 billion pounds ($1.61 billion), according to Sky News.
Philip Green declined to comment.
The buyer could be one of the joint owners of U.S. retailer J Crew, private equity titans TPG Capital or Leonard Green and Partners, the report said.
Leonard Green and TPG could not immediately be reached for comment.
British retailers are mostly struggling as consumers hold back spending in the face of job insecurity, rising prices, subdued wage growth and government austerity measures.
Arcadia posted a 25 percent year-on-year rise in underlying profit to 166.9 million pounds ($269 million) in the year to August 25.
Arcadia’s total sales from about 2,500 UK stores and 615 franchised outlets in 39 countries were flat at 2.68 billion pounds.
Monaco-based Green, who was knighted in 2006, bought department store chain BHS for 200 million pounds in 2000, Arcadia for 850 million pounds in 2002 and has twice tried and failed to buy Marks & Spencer (MKS.L).
In an interview with Reuters in November he said he was not averse to doing another major deal if the right one crossed his table.
Green’s family ranked 17th on the 2012 Sunday Times UK rich list with an estimated fortune of 3.3 billion pounds.
TPG and Leonard Green bought J Crew in 2010 in a deal valued at about $3 billion.
($1 = 0.6209 British pounds)
Reporting By James Davey and Anjuli Davies; Editing by Tim Dobbyn
Photo credit: Retail billionaire Philip Green , whose Arcadia Group owns the Topshop clothing chain, sits with his daughter Chloe before the presentation of the Topman Design 2012 Spring/Summer collection during London Fashion Week September 21, 2011. Credit: Reuters/Suzanne PlunkettGet your FREE trial or subscribe now to Buyouts to find new deal opportunities, super-charge your fundraising efforts and track top managers.