The backers of Poundland, which include US buyout firm Warburg Pincus, could offload as much as half of their stake when the UK discount retailer floats next month, according to people familiar with the situation.

The West Midlands-based company, which operates more than 500 stores across the UK and Ireland, is targeting a valuation of between £700 million and £750 million, according to people familiar with its initial public offering.