Ralph Lauren steps off the catwalk and into the Brooks Brothers bidding

Polo Ralph Lauren, the upmarket American retailer and designer, has emerged as a potential bidder for Brooks Brothers, the "preppy" clothing chain recently put up for sale by Marks & Spencer.

Ralph Lauren is one of seven bidders that have made it through to the second round of the auction after more than 20 initial bids were received last month. The others are believed to be May Department Stores, the quoted US retail group which includes the Lord & Taylor chain, Mens Warehouse, another American retailer, and Retail Brand Alliance Group, which owns the Casual Corner stores. Also still in the frame are Texas Pacific, the leveraged buyout specialist which owns J Crew and Bally shoes, Bain Capital, a Boston-based venture capital firm and Dickson Concepts, the Hong Kong-based retailer which already operates Brooks Brothers franchises in south-east Asia.

US retail sources say Chris Littmoden, the former head of Brooks Brothers, is rumoured to be interested in entering the fray. Joe Gromek, the current chief executive, is also in a strong position to continue running the chain if a venture capitalist buyer is successful.

Presentations were continuing this week, led by Morgan Stanley Dean Witter, which is advising Marks & Spencer on the sale. The winner is not expected to be announced until September or October. Brooks Brothers is valued at only $400m-$450m (£280m-£315m), well below the $750m (£525m) M&S paid in the late 1980s.

The leader in the bid battle is still thought to be May Department Stores as it has the deepest pockets. However, the interest of Polo Ralph Lauren adds a glamorous new dimension to the sale process. Ralph Lauren has 34 US stores and 121 overseas. However, most of its operations trade under the Polo or Ralph Lauren names so the acquisition of a rival brand would represent a departure. Polo Ralph Lauren is valued at $2.4bn (£1.7bn) on the US stock market and made profits of $166m (£116m) last year on sales of $2.25bn.

Marks & Spencer put Brooks Brothers up for sale in March when it announced it was pulling out of the US and selling all of its wholly owned operation in continental Europe. M&S is also selling its Kings supermarkets operation in New Jersey.