Hopes of retail mogul Sir Philip Green thrashing out a quick-fire deal for a stake in Baugur Group's UK fashion assets have been dealt a blow by rumours that private equity firms are lining up for a more prolonged bidding war.

According to the Financial Times newspaper, Texas Pacific Group (TPG), Alchemy and Permira are keen to buy Baugur's debt in return for a share in its UK high street assets, which include fashion chains Whistles and Jane Norman, Mosaic Fashions - including the Oasis, Warehouse and Karen Millen retail brands - and UK department store chain House of Fraser.

It follows Sir Philip's meeting with the Icelandic company's chairman, Jón Asgeir Jóhannesson, and Government officials last weekend.

He is also looking to strike a deal to acquire Baugur's reported GBP1bn-GBP2bn debt, after the company was left reeling by the collapse and subsequent nationalisation of Iceland's banking system.

The company has made no comment on the possibility of a deal with any party, but yesterday (14 October) denied reports that it had appointed advisers and said it had no plans to place its UK business into administration.

TPG and Permira both made no comment on the speculation when contacted by just-style this afternoon.