Topshop and Topman have been valued at £2 billion after retail tycoon Sir Philip Green sold a 25% stake in the fashion brands.

The entrepreneur's Arcadia Group, which also owns Bhs, Burton and Dorothy Perkins, netted £500 million after agreeing to sell the Topshop stake to American private equity firm Leonard Green & Partners.

The high street magnate said the deal will help his group expand Topshop and Topman brands further across the US and internationally.

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Sir Philip signalled a potential spending spree as he said the cash from the sale will remain in the Arcadia Group, leaving it debt-free and offering the "flexibility to look at other opportunities".