THE private equity owners of Dorset-headquartered fashion chain New Look were today said to be preparing for the possible £2 billion sale of the business.

It was reported today that such a takeover price would produce an overall return of up to £1.3 billion for Apax and Permira, the buy-out firms behind the £699 million takeover of the retailer in March 2004.

Apax and Permira own 66 per cent of the business and have already doubled their £150 million investments through two refinancings, it is reported.

New Look, which is believed to have asked Merrill Lynch to conduct a strategic review, is said to have already received expressions of interest from a number of private equity bidders.

Apax and Permira are understood to have ruled out a flotation of the business, while New Look's management are also keen for the chain to stay private as it concentrates on expanding the retailer internationally.