Stores will continue trading while a buyer is sought for a business, while efforts "will now be focused on giving the company a chance of future survival through a reduced and different business model".
Frank Morton, CEO of Gordon Brothers Europe said that "despite our best efforts, we regret that we are now forced to make some redundancies and would like to thank any affected employees for their support during the last six months."
Blockbuster went into admistration in January of this year, at which time Deloitte was appointed as an administrator.
At that time Lee Manning, partners at business advisory Deloitte, said that "in recent years Blockbuster has faced increased competition from internet based providers along with the shift to digital streaming of movies and games".
Traditional rental stores like Blockbuster have suffered as technology has moved on. With opportunities to watch new content online with services like Netflix and Lovefilm customers have been less willing to visit a physical store.
Gordon Brothers rescued the failing group in a deal to see 264 of Blockbuster's 528 stores stay open, along with nearly half of its 4,190 strong staff.