Hirst originally purchased the shark from Australia for �6,000

The work, entitled The Physical Impossibility of Death in the Mind of Someone Living, was commissioned by Mr Saatchi in 1991 for �50,000.

A spokeswoman for Mr Saatchi's London gallery said a deal could be reached in the next few weeks.

The work propelled Hirst to fame after it was first shown in 1992.

Hirst originally purchased the shark from Australia for �6,000 and it appeared as part of an exhibition called Young British Artists.

The exhibition at the London gallery went on to define a new wave of British art, characterised by Hirst's inventive and daring works.

Traditional move

The lucrative deal is believed to have been offered by a client of Hirst's agent, American art dealer Larry Gagosian, fuelling speculation that it would not remain in the UK.

However, the Saatchi Gallery would not confirm the identity of the potential buyer, and refused to comment on reports that Mr Saatchi had accepted the bid.

Earlier in the year, Saatchi sold 12 of Hirst's pieces back to the artist's White Cube Gallery, after reportedly falling out in a row over how Hirst's pieces were exhibited.

Mr Saatchi, famed for his patronage of controversial artists like Hirst and Tracey Emin, has recently indicated a shift in emphasis towards more traditional oil paintings.

Next month, the installation art usually favoured by Mr Saatchi will be removed from his County Hall Gallery in London to make way for a new painting exhibition.