A bid to buy the entire Wilko business has fallen through, Sky News understands.
Private equity firm M2 Capital had hoped to purchase the discount homeware chain and its 400 stores, but the deal is off following talks with administrators PwC.
Job losses are now expected among Wilko’s head office, distribution and support centre staff.
Around 1,300 roles are at immediate risk of redundancy, but some of those will be saved as they are needed to keep stores running.
The retail chain, which employs around 12,500 staff in total across the country, collapsed earlier this month after struggling from inflationary pressures, competition from rivals and supply chain challenges.
But its branches have remained open since then in the hope a buyer can be found.
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Other bids for parts of the business have been received, which administrators will now focus on.
Poundland-owner Pepco Group and B&M European Value Retail are among the firms aiming to acquire part of Wilko’s store estate.
HMV owner Doug Putman also expressed an interest in making a bid prior to PwC’s deadline of last Friday.
No store closures or store redundancies are expected this week.
It comes following a warning from the GMB union, which is representing thousands of Wilko workers, that some job losses could be announced on Thursday.
The union and PwC are holding further talks on Thursday morning.