JJB Sports has gone into administration and thousands of jobs are at risk after the company has suffered financially for months.
The sports retailer will close 133 of its stores and upto 2,200 redundancies will be made, after administrators KPMG were appointed.
Rival store Sports Direct announced the acquisition of 20 JJB stores, as well as the brand and the website, which will preserve approximately 550 jobs.
Owner Mike Ashley will pay a cash consideration of £23.77m for part of the JJB business, with an additional consideration of £0.25m.
Administrators KPMG said attempts to restructure the business had failed, and that closures were unavoidable at this stage.
UK Head of Restructuring at KPMG, Richard Fleming, commented: “We will now be reviewing what options are available for the remainder of the business, such as selling leasehold interests.
“All staff made redundant as a result of store closures have had their arrears of wages and holiday entitlements paid in full.
“Our team of employment specialists will be supporting staff on completing redundancy forms and putting them in touch with job seeker services.”
David McCorquodale, corporate finance partner at KPMG, was also responsible for the administration of the company and led the sales process to JD Sports.
He said: “In spite of the severity of financial distress suffered by the business, we spoke with over 100 parties in the first few days of our appointment; with 8 trade and private equity players tabling first round bids.
“Unfortunately the level of cash and further operational restructuring required to rescue a more substantial part of the business was too much risk for most interested parties.
“We hope to be able to sell the leasehold interests of some of the remaining stores, which may result in re-employment of some staff.”
The Office of Fair Trading will consider Sports Direct’s acquisition proposal before the deal can be confirmed.
Retail consultant, Graham Soult, commented: "Unfortunately, JJB’s demise has been on the cards for some time.
“In recent years, it has suffered from poor leadership, lack of focus and a confused market positioning, while its big rivals Sports Direct and JD have been able to thrive.
“Having overtaken JJB as the market leader, Sports Direct now cherry-picking 20 of the best stores from JJB’s estate is a sign of just how far and fast the balance of power among sports retailers has changed.”