Jaeger, the 133-year-old fashion brand, is expected to go into administration.
The collapse of the brand, which was snapped up private equity tycoon Jon Moulton in 2012 in a £19.5m deal, could put almost 700 jobs at risk.
If the brand goes under, Edinburgh Woollen Mill is likely to buy it out of administration, the Sunday Times reported. Edinburgh Woollen Mill will likely sell most of Jaeger's 25 loss-making stores and increase the online presence of the brand.
Jaeger's sales dropped from £84.2m to £78.4m in 2016 while it recorded a loss of £5.4m. Last year Jaeger closed three stores including its Regent Street flagship. In October, it opened a two-floor, 2,000 square feet store on Marylebone High Street.
In an interview with City A.M. earlier this year, Moulton blamed the heavy discounting witnessed on the high street for the sector’s troubles.
“Everyone seems to be offering clothes at minus 70 per cent and that really is a nuisance because it destroys the image of your brand, it is hurting lots of retailers. Even Burberry is not having an easy time.”
Moulton declined to comment, citing non-disclosure agreements.