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Debenhams, the department store chain, is facing administration for a second time.
The retailer is set to appoint administrators as early next week to protect the company against claims from creditors as it tries to restructure its business.
Debenhams has already closed 22 stores this year and plans to shut a further 28 in 2021.
However, the coronavirus outbreak has ramped up pressure on the firm.
Like much of the rest of the High Street, Debenhams 142 stores are closed.
Although the business is still trading online, it has a large amount of stock which it cannot sell.
It is understood that Debenhams is concerned about potential legal claims from suppliers who have yet to be paid.
A Debenhams spokesperson said: “Like all retailers, Debenhams is making contingency plans reflecting the extraordinary current circumstances.
“Our owners and lenders remain highly supportive and whatever actions we may take will be with a view to protecting the business during the current situation.”
It is expected that the most likely outcome is a pre-pack administration, where a company arranges to sell its business to a pre-determined buyer before administrators are appointed.
Last April, Debenhams fell into the hands of its lenders, comprising a group of banks and hedge funds led by US firm Silver Point Capital, after struggling for years to keep up with competition from rivals.
It has also faced rising costs in running its big stores as well as grappling with a huge amount of debt.
A source familiar with the company’s current thinking told the BBC that if a pre-pack was to happen, the current owners intend to take the business out of administration once stores are allowed to re-open and were in talks to inject funding as part of its existing turnaround plan.
Landlords have already been told that a number of restructuring scenarios are being explored, which have “varying outcomes” for the business, landlords and Debenhams’ 20,000 workers.
