Marks & Spencer, once the UK's most admired clothing retailer, is facing an £8 billion-plus (€12 billion) takeover bid from Mr Philip Green, a billionaire entrepreneur who already owns some of its closest rivals on the British high street.

Shares in the struggling retailer leapt almost 19 per cent in London trading yesterday, as Mr Green confirmed he was "considering a possible offer" and traders speculated about interest from private equity groups.

Although Mr Green gave no indication of a possible price-tag, the rise in the shares to 354p took M&S's market capitalisation to £7.8 billion. He is being advised by Merrill Lynch and Goldman Sachs for what would be one of the largest takeovers in Europe this year.

M&S was once Britain's biggest and most profitable retailer, supplying generations of middle-class families with staples such as underwear and blouses. However, it has struggled to establish direction in the face of strong competition from rivals that have moved into M&S's traditional territory in clothing.

Analysts said Mr Green's interest could herald a shake-up of M&S's suppliers, whether he wins control or a new management is brought in.

Mr Green, who owns retail groups Arcadia and BHS in the UK, is expected to make his approach to the M&S board as early as today.

"Any proposal would involve a mixture of cash and shares in a new company which would seek a listing," said a statement from Revival Acquisitions, a group controlled by the Green family. The statement added that Revival would seek a recommendation from the board of M&S but there was no assurance an offer would be made.

Mr Green's move comes as M&S is seeking a new chairman, and as it is in the middle of a strategic overhaul.

Mr Roger Holmes, M&S chief executive, on Wednesday promised a "complete transformation" of the chain, acknowledging that improvements were needed in almost all parts of the business.

Mr Green is credited with turning around BHS, which is estimated to have increased fivefold in value since he bought it for £200 million four years ago. He considered an offer for M&S in 1999 but withdrew, blaming "the glare of publicity". He is expected to have to make disposals to counter antitrust concerns.

M&S said this week that UK sales rose 1.8 per cent in the year to April, but fell 0.4 per cent on a like-for-like basis.

Pre-tax profits rose from £506.9 million to £552.3 million. - (Financial Times Service)