UPDATE 1-Advent International buys UK sofa retailer DFS

* Deal worth 500 mln stg - source

* DFS founder Graham Kirkham to retain financial interest

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LONDON, April 22 (Reuters) - Private equity firm Advent International is buying British sofa retailer DFS in a deal one person familiar with the process said was worth about 500 million pounds ($769 million) to founder Graham Kirkham.

Advent, whose retail investments include Poundland and Fat Face in the UK, Charlotte Russe in North America and Takko in Germany, said on Thursday Kirkham would retain a financial interest in DFS.

Advent and DFS did not disclose the value of the transaction.

The company, based in Doncaster, northern England, operates from 74 stores across the UK and employs more than 2,600 people.

Advent said operating partner Richard Baker, a former chief executive of Alliance Boots, would take over as chairman from Kirkham.

It said chief operating officer Jon Massey and finance director Bill Barnes would remain with the business.

Kirkham, who founded DFS in 1969, had told the Sunday Times last month he was "categorically not interested in selling the business" as he was "loaded" and didn't need the cash. [ID:nLDE62R0CF] (Reporting by James Davey and Simon Meads, editing by Will Waterman) ($1=.6501 Pound)