Two chains that are part of the retail empire owned by Philip Day have fallen into administration after a protracted process to restructure the wider business, putting 2,900 jobs under threat.
Administrators were called in on Friday after consultants failed to find buyers for the Edinburgh Woollen Mill and Ponden Home chains, and 866 staff were immediately made redundant.
Both will continue trading, subject to lockdown restrictions, but thousands more staff could lose their jobs.
In the weeks leading up to their demise, 56 stores and concessions across both brands had permanently closed, leading to 600 redundancies.
The news is a further blow for Britain's battered high streets after John Lewis and Sainsbury's cut 1,500 and 3,500 jobs respectively this week.
Meanwhile, a string of big retail names face a High Court dispute over allegations they have not paid rent for shops in Westfield's shopping centre in east London. The spat is the latest sign of rising tensions between commercial landlords and tenants.
Unibail-Rodamco-Westfield, the French company that owns the Stratford complex, has logged a flurry of claims against chains including Coach, Russell & Bromley, Guess, Urban Outfitters, Geox, the Fragrance Shop and Pret A Manger, filings reveal.
Lawyers for Westfield also wrote to The Entertainer this week demanding rent payment or risk being taken to court. The retailer has stores in both the Stratford and White City centres in London.
Gary Grant, who founded the toy chain, said the mall operator was playing hardball rather than having constructive discussions about repayments.
He added: “I was seriously mad. First day of a second lockdown in my second-busiest month of the year. Where is the partnership, when your landlord comes after you with a final demand? We have tried to engage with Westfield … we run a good business.”
Scott Parsons, the regional managing director of Unibail-Rodamco-Westfield, said it sought to work in partnership with its tenants.
"Only in situations where a retailer has refused to collaborate in pursuit of an agreement that could work for both parties would we consider legal action," he said.
Meanwhile, advisers to EWM and Ponden Home said the chains had been trading well before the pandemic struck, but sales were hit by lockdown restrictions and fewer visits from its core customers - elderly shoppers and overseas tourists.
Carlisle-based Edinburgh Woollen Mill, which was set up in 1947, is a knitwear and homeware retailer. It had 384 stores and 2,571 staff before trading deteriorated. Ponden sells homewares, curtains, bedding and furniture and had 73 stores and 329 staff before it collapsed.
Tony Wright, joint administrator and partner at FRP, said: “The administrations will provide some further protection while we continue our search for buyers to secure the long-term futures for both businesses."
Mr Day has put himself in a strong position to salvage parts of the struggling retail empire after he extended a loan in return for security over its assets.
The wider Edinburgh Woollen Mill group, which owns a stable of other brands, are not part of the administration.
The company has secured an extension from the High Court to allow it to find a buyer or fresh investment for some or all of the chains. The Jaeger and Peacocks names, however, are the most likely to be sold, according to Mr Day.
He said: "Over the past month we explored all possible options, but unfortunately the pandemic and the lockdowns proved too much. It is with a heavy heart we acknowledge there is no alternative but to place the businesses into administration.
"In the case of Peacocks and Jaeger we are speaking to a number of parties who are interested in either buying parts of the business or offering investment and those conversations are ongoing."
The group posted pre-tax profits of £32.2m on sales of £296.7m in the six months to March 2019. It had £114.8m of cash in the bank and no bank debt.