Arcadia owner Sir Philip Green has sold a 25% stake in his Topshop and Topman brands to private equity firm Leonard Green & Partners in a deal that values them at GBP2bn.

Green said the funds will remain in the Arcadia Group, enabling it to continue to drive all of its businesses.

"Being debt free gives us the balance sheet and flexibility to look at other opportunities to consolidate or acquire, either on our own or in partnership with LGP, who have substantial capital available in their new fund," said Green.

LGP's experienced management teams and knowledge of retail in the US will greatly assist Topshop/Topman with their global expansion, added Green. He said that with LGP, the plan will be to step up its international investment programme as relevant locations present themselves around the world.

Arcadia has been working to expand the brand internationally, with market entries in the US, Brazil, Canada and Australia in recent years.

LGP is a co-owner of US retailer J Crew, which is set to enter the UK market next year.

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%.