More than 30 enquiries to buy BHS out of administration have been made since reports first surfaced that the business was teetering on the brink, City A.M. understands.
Managing directors Philip Duffy and Benjamin Wiles were appointed joint administrators of BHS this morning, putting around 10,000 jobs at risk.
In a statement Duff & Phelps said: "The group has been undergoing restructuring and, as has been widely reported, the shareholders have been in negotiations to find a buyer for the business. These negotiations have been unsuccessful.
"In addition property sales have not materialised as expected in both number and value. Consequently, as a result of a lower than expected cash balance, the group is very unlikely to meet all contractual payments. The directors therefore have no alternative but to put the group into administration to protect it for all creditors. The group will continue to trade as usual while the administrators seek to sell it as a going concern."
Sports Direct has been in talks to buy the business, but negotiations are thought to have faltered over the cost of plugging the £571m pension deficit.
However by entering administration, the pensions liabilities are deferred to the Pension Protection Fund (PPF), making the prospect of buying the group out more attractive.
A source told City A.M. it was now likely the Mike Ashley-owned retailer would swoop in, having already carried out due diligence.
But if no buyer is found, it could lead to the closure of BHS' 164 department stores and thousands of job losses, making it the biggest retail failure since Woolworths in 2008.
Reports first surfaced on Friday that the business, which was sold by Sir Philip Green to the unknown group Retail Acquisitions for £1 last year, was poised to enter administration.
Read more: Everything we know about Retail Acquisitions
Dominic Chappell, a former bankrupt and racing car driver, sent a letter to a select number of staff this morning, confirming the plans.
In it, he said: “It is with a deep heart that I have to report, despite a massive effort from the team, we have been unable to secure a funder or a trade sale.”
He told staff that "your wages etc will be covered this month”.
Dominic Chappell's letter in full
It is with a deep hart that I have to report, despite a massive effort from the team, we have been unable to secure a funder or a trade sale.
We as directors have called for a administration tomorrow in the am. Phill Duffy has been appointed and we have been assured that your wages etc will be covered this month.
I am sincerely sorry it has come to this, you all worked so hard, I will always be grateful to all of you and your team's, pls thank them and apologise on my behalf.
Eddie, Mike, Aden and I are trying to put a few things together over the next week or so and will be in touch as things progress
As a few of you know I have not been well for a few months, I will be away this week having a operation, it is something I must have done and have put off a number of times but I cannot any more, trimming sucks. Ellie and I will be in contact during the week and I will be back in the office if required the following week.
I would like to say it has been a real pleasure working with all of you on the BHS project, one I will never forget, you all need to keep your heads held high, you all have done a great job, but remember that it was always going to be very very hard to turn around.
Bonne chance mon ami