Value retail chain Matalan Plc has confirmed that it will sell its Lee Cooper brand to private equity firm Emerisque Capital for £30 million, and has reported a 31 per cent hike in full-year underlying profit on new store openings and better mailer product availability.

Matalan, which operates more than 180 UK stores, said profit before taxation and exceptional items totalled £83.5m compared to £63.5m last year. Pre-tax profit was £56.2m, down from £63.5m.

Full-year rose grew 12.3 per cent to £1.10 billion, while same-store sales rose 4.5 per cent.

Matalan refurbished 30 stores throughout the year, which it says are seeing sales growth 5 per cent ahead of the rest of the group. The company plans to open another 90 stores over the coming three years. A new distribution centre in Corby had also helped business, Matalan said.

As part of the agreement to sell off the Lee Cooper brand, Matalan has won the right to use the brand in its UK stores.

Matalan itself has been subject to a string of possible takeover rumours, with suggested suitors said to be US retailer Target and UK supermarket giant Tesco.

The company also said that two new  non-executive directors  - Geoff Brady and Bill Shannon - have joined the company, while a third,  Martin Reavley, will join in July.