Boohoo is set to buy the Debenhams brand and website.
However, the fast fashion retailer will not be taking on any of the company’s remaining 118 High Street stores or its workforce.
The announcement could come as early as Monday morning.
The 242-year-old chain is already in the process of closing down, after administrators failed to secure a rescue deal for the business, with the likely loss of 12,000 jobs.
A closing down sale at 124 Debenhams stores began in December, as administrators continued to seek offers for all, or parts of the business.
In the last week or so, the company announced that six shops would not reopen after lockdown, including its flagship department store on London’s Oxford Street.
Boohoo has already bought a number of High Street brands out of administration. It snapped up Oasis, Coast and Karen Millen, but not the associated stores.
Debenhams and Boohoo declined to comment.
Rescue deals fell through
Debenhams has struggled for years with falling profits and rising debts, as more shopping has moved online. It called in administrators twice in two years, most recently in April.
However, its position became untenable during the coronavirus pandemic as non-essential retailers were forced to close for prolonged periods.
The firm had already trimmed its store portfolio and cut about 6,500 jobs since May, as it struggled to stay afloat.
Businessman Mike Ashley, who founded Sports Direct and also owns House of Fraser, had already made an offer for Debenhams after it was initially put up for sale in April.
However the takeover offer, thought to be in the region of £125m, was rejected as being too low, leaving JD Sports as the last remaining bidder.
Mr Ashley had previously built up a 29% stake in the chain, but saw his £150m holding wiped out in 2019, when the company fell into administration and then ended up in the hands of its lenders – a consortium led by hedge fund Silverpoint.
In early December, the Frasers Group confirmed that it was working on a possible last minute rescue of Debenhams.
The announcement came five days after staff were informed and liquidators moved in to Debenhams’ stores to start clearing stock, after a potential rescue deal with JD Sports fell through.
But Frasers said there was “no certainty” it could save the chain.
One of the biggest issues, it said, was the collapse into administration last week of another High Street giant, Arcadia, which is the biggest concession holder in Debenhams department stores.