Green's bid is made up of a £7bn cash component which values the M&S shares between 290-310p, as well as a 25 per cent stake in a new company set up to manage the M&S takeover.

In a statement to the London Stock Exchange, Green said he has personally committed up to £1.05bn to the takeover bid, and is financially backed by £7.5bn from investment banks including Merrill Lynch and Goldman Sachs. Green added in his statement that the proposal is dependent on the "satisfactory review" of M&S's contract with clothing designer George Davies, and of the investment programmes including M&S's Simply Food outlets.

The entrepreneur who already owns the Bhs and Arcadia groups had previously attempted to buy Marks & Spencer in December 1999 but backed down to avoid a dispute with management. Green said the current offer is now dependant on a recommendation from the M&S board.

The stock market reaction has been negative, as M&S shares fell 3.8 per cent in London when trading commenced for June 3. Some traders have said that the proposed bid was low.

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