West Private Equity, the private equity arm of German bank West LB, is understood not to be pursuing a deal with Arcadia Group, the UK clothes retailer that walked away from a deal with Bridgepoint Capital last week.

West Private Equity declined to comment on reports that it was in negotiations with Arcadia Group, which is looking to sell four of its fashion chains to focus its activities on its core businesses: Topshop, Miss Selfridges, Wallis and Evans. Sources say proceeds from any sales to private equity would be used to reduce its £160m (€255m) debt.