'Ghost' founder makes £5m as chain plans expansion

Her fluid dresses are loved by women of all ages for the flattering way they hug the figure. Now Tanya Sarne, a former model who founded the fashion label Ghost 21 years ago, has sold a controlling interest in her company for £5m - a move which will boost the brand's presence on the high street.

Ms Sarne will continue to head up design at Ghost, which has won plaudits for the fluid lines and soft bias-cut shapes of its collections.

Meanwhile the new owners will concentrate on expanding the brand, whose clients include Julia Roberts, Jennifer Aniston, Liv Tyler, Catherine Zeta-Jones and Emma Thompson.

Ms Sarne said of the deal: "I believe it will be possible to build a different type of fashion presence on the high street, with further stores of our own, as well as new concession outlets."

She began designing clothes in the mid-1970s after the break-up of her marriage left her struggling to support two young children. She launched Ghost in 1984, employing a team of designers to "ghost-write" the collection, though she oversees the work.

Her current head designer is Amy Roberts, hired from John Galliano, while Nicholas Knightly, now the chief designer at Louis Vuitton, and Suzanne Deeken, designer at Marc by Marc Jacobs, are both former Ghost designers.

The label is best known for its crepe, georgette, velvet and satin dresses, which avoid unflattering hard lines.

Ms Sarne has also pioneered practical clothes - her shrink-to-fit dresses are machine washable and can be packed in a suitcase with no need for ironing.

Despite its celebrity client base, Ghost has never made significant profits - last year, the company made less than £1,000, recovering from losses of more than £70,000 in the previous 12 months. Ms Sarne began looking for business partners earlier this year. "I started the business with virtually nothing and after driving it for 20 years, I believe I have taken it as far as I can," she said.

The designer will retain a 32 per cent stake in Ghost but she has sold two 30 per cent chunks of the business to Kevin Sanford, the retail entrepreneur, and a group of Icelandic investors.

Mr Sanford, the co-founder of the Karen Millen chain, already has a wide portfolio of retail interests. Having sold his share of Karen Millen last year, he banked £11m in profits after buying and selling a 1 per cent stake in Marks & Spencer. He also owns 29 per cent of the menswear retailer Moss Bros and 25 per cent of Mulberry, the handbag retailer.

The Icelandic investors also have a track record in retail. The group is headed by Jon Scheving Thorsteinsson, a former executive of the retail investment group Baugur, which owns chains such as Oasis.

Mr Sanford will join Ghost as non-executive chairman, and will focus on opening new retail outlets for the brand. Ghost currently has 12 sites - they include standalone stores in London, New York and Los Angeles, but the majority of sales come from concessions in department stores such as Selfridges.

Although Ghost has a reputation as a label worn by the stars, its collections are moderately priced compared to many designer retailers, with pieces starting at around £100.