Europe’s biggest buy-out group, Permira, has offered to hand back €1.5bn ($1.9bn) of unused capital to investors, the first time a private equity group of its size has broken the iron-clad commitments that tie backers into a fund for at least 10 years.

The London-based group, which owns stakes in New Look, the high street retailer, Valentino, the Italian fashion group, and Birds Eye Iglo, the frozen food group, said its fund could fall from €11bn to €9.5bn. When it raised the fund in 2006 it set a record for private equity in Europe.