Paperchase goes into administration

Joint administrators Begbies Traynor said: "Unfortunately, despite a comprehensive sales process, no viable offers were received for the company, or its business and assets.

"However, there has been significant interest in the Paperchase brand and attendant intellectual property."

Paperchase employs around 820 people across 106 stores. The administrators said all stores will remain open and trade as normal in the short term and the retailer will continue to honour gift cards. However, customers were urged to redeem these as soon as possible.

Earlier, Sky News reported that supermarket chain Tesco was poised to snap up the Paperchase brand.

It said Tesco was in advanced talks about buying Paperchase's name and other intellectual property through a pre-pack administration that could take place as early as Tuesday.

Sources close to the situation told Sky that Tesco was unlikely to be interested in any of Paperchase's stores, meaning that most of its workforce may face the prospect of losing their jobs.

It was unclear whether any other suitors were in talks about a deal.