Sir Philip Green is allegedly in talks to sell a stake of up to 25% in the Topman and Topshop chains to the private equity owners of US retailer J Crew.

The deal, which is not yet finalised, is expected to value the two chains at close to GBP1bn (US1.6bn), according to Sky reports.

J Crew is owned by Leonard Green & Partners (LGP) and TPG Capital. The report said LGP had been in talks with Green about making an investment in Topshop for some time.

The funds from the sale would be used to accelerate Topshop's international expansion. Arcadia has been working to expand the brand internationally, with market entries in the US, Brazil, Canada and Australia in recent years.

Topshop and Topman parent company Arcadia saw its full-year pre-tax underlying profit rise 25% to GBP166.9m. Total sales were predominantly flat, but underlying UK retail like-for-like sales fell 3.2% and total like-for-like sales were down 0.7%.

J Crew was taken private by the two private equity firms in March 2011, in a deal worth US$3bn. The brand is set to enter the UK next year with a store on London'sRegent Street.

When contacted by just-style, a spokesperson for Arcadia said an announcement on the plans could be made tomorrow.