ALL Debenhams stores are set to close after the last potential rescuer for the business pulled out.

The news – which follows administrators being called in at the Arcadia group – means 25,000 retail jobs are now at risk.

JD Sports announced on Tuesday morning that it had pulled out of rescue talks for Debenhams, putting 12,000 workers at risk.

The demise of Debenhams would spell the end of stores in Winchester, Fareham and Portsmouth. The chain's Southampton branch was axed during this year's first lockdown after the company went into administration.

Debenhams in Southampton will not reopen after coronavirus lockdown

Joint administrators from FRP Advisory said they were starting a wind-down of all 124 Debenhams stores to clear current stock while remaining open to bids for the business.

Geoff Rowley, partner with FRP Advisory and joint administrator to Debenhams, said: “All reasonable steps were taken to complete a transaction that would secure the future of Debenhams. However, the economic landscape is extremely challenging and, coupled with the uncertainty facing the UK retail industry, a viable deal could not be reached.

“The decision to move forward with a closure programme has been carefully assessed and, while we remain hopeful that alternative proposals for the business may yet be received, we deeply regret that circumstances force us to commence this course of action.

“We are very grateful for the efforts of the management team and staff who have worked so hard throughout the most difficult of circumstances to keep the business trading. We would also like to thank the landlords, suppliers and partners who have continued to work with Debenhams through this turbulent period and can reassure them that all contractual obligations entered into in the administration period will be met in full.”

JD Sports was the last remaining bidder for Debenhams, which has been in administration since April.

In a brief statement to the London Stock Exchange, the company said: “JD Sports Fashion, the leading retailer of sports, fashion and outdoor brands, confirms that discussions with the administrators of Debenhams regarding a potential acquisition of the UK business have now been terminated.”

Debenhams has already cut 6,500 jobs across its operation due to heavy cost-cutting after it entered administration for the second time in 12 months.

It is understood that the collapse of the deal is partly linked to the administration of Arcadia, which is the biggest operator of concessions in Debenhams stores.

Arcadia went into administration on Monday evening, casting a shadow over its own 13,000 workers and 444 stores.