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13 January 2021, 14:15 | Updated: 13 January 2021, 18:54
The American owner of Barneys, the famous New York department store, is in talks with JD Sports Fashion about joining forces in a swoop on Topshop, the jewel in Sir Philip Green's former retail empire.
Sky News has learnt that Authentic Brands Group has been holding early-stage discussions with JD Sports about the London-listed company running Topshop's operations if its bid is successful.
The combination of Authentic, which also owns Forever 21, and JD Sports, one of the most adept players in British retailing, adds up to a powerful contender to buy Topshop from the administrators to Arcadia Group.
Final offers for Sir Philip's former assets are due to be tabled in the coming days, with high street behemoths including Next expected to be among the bidders.
JD Sports, run by Peter Cowgill, did not make an offer of its own for any of Arcadia's brands, but is said to have a good working relationship with Authentic and its chairman, Jamie Salter.
People close to the talks between Authentic and JD described them as preliminary and "far from concrete" but acknowledged that JD becoming operating partner for an Authentic-owned Topshop was a credible prospect.
News of their potential collaboration comes as administrators to Debenhams continue to wind down the department store chain, with stores including its Oxford Street flagship now earmarked for permanent closure.
The third English lockdown has wreaked further havoc on the retail sector, with Paperchase filing a notice of intention to appoint administrators last week.
Deloitte, which is handling Arcadia's insolvency, is trying to secure deals for as many of the group's assets as possible in the coming weeks.
Evans, the womenswear brand, has already been sold to City Chic, an Australian group, with a number of other parties circling labels such as Dorothy Perkins and Miss Selfridge.
Sky News revealed last month that Next and Davidson Kempner Capital Management were plotting a combined offer for the whole of Arcadia, with many analysts now regarding their bid as the frontrunner.
Mike Ashley's Frasers Group and Boohoo Group, the online fashion retailer, may also table final offers.
Up to 13,000 jobs are at risk from Arcadia's collapse, with brands including Evans, Wallis and Outfit seen as less likely to attract bidders.
It is the demise of Sir Philip's high street status that is likely to emerge as the most enduring symbol of the pandemic's impact on Britain's economy.
Sir Philip bought the high street group in 2002 for £850m, and just three years later paid what remains one of the largest-ever dividends - £1.2bn - to Arcadia's registered owner, his wife Lady Christina.
For years, he was feted as a high street colossus, advising David Cameron on public sector waste during his period as prime minister.
In 2012, he sold a 25% stake in Topshop's immediate holding company to Leonard Green & Partners, a private equity firm, valuing the fashion chain at £2bn.
Sir Philip was later to buy it back for just $1.
His decision to sell the department store chain BHS in 2015 for £1 to Dominic Chappell, a former bankrupt who was recently jailed for tax evasion, set off a chain of events which cost Sir Philip his reputation and much of his fortune.
BHS collapsed just a year after that deal, sparking a bitter row about Sir Philip's responsibilities towards its pensioners.
In early 2017, Sir Philip struck a deal with pensions watchdogs to pay more than £360m to the BHS scheme and which set the tone for negotiations over Arcadia's retirement fund two years later.
Last year, the tycoon narrowly secured approval for a company voluntary arrangement at Arcadia, but was forced to pledge a package of assets worth more than £400m to the company's pension scheme.
JD Sports declined to comment on Wednesday.
(c) Sky News 2021: JD Sports in talks about Authentic bid for Topshop