Laura Ashley said on Tuesday it intends to appoint administrators as the coronavirus outbreak has had an immediate and significant impact on the UK retailer's performance, sending its shares down more than 64%.
British retailers have faced challenges in the past few years and Laura Ashley, a favorite of late Princess Diana in its 1980s heyday, has seen sales fall, store closures, weakness at its home furnishings business and a worsening consumer mood.
The company said it is in advanced talks for third-party debt funding but it would not be able to draw down additional funds from lenders in time. Its largest shareholder, MUI Asia, will not be able to provide financial support either.
The clothing and furnishing retailer is the latest in a list of brands considered the mainstay of British shopping scene to go under. House of Fraser and department store chain Debenhams have also been placed in administration.
Trading in the business for seven weeks to March 13 improved by 24% compared to last year but the pandemic has kept many shoppers away.
Laura Ashley intends to appoint Robert Lewis and Zelf Hussain as administrators and said it was not certain whether there would be any surplus assets available for shareholders of the company.
Shares in the company, which will be suspended, had fallen to 0.03 pence by 1108 GMT.