A rescue deal to save Wilko has fallen through, leaving round 12,500 Wilko staff facing redundancy with all 400-plus stores to close.

The GMB trade union, which is understood to represent around 4,000 Wilko employees, said Monday that PwC, which was brought on as Wilko’s administrator in August, confirmed to it that the previous offer being explored for the sale of hundreds of stores as a going concern has fallen through.

Canadian billionaire Doug Putnam – who also owns HMV and Toys R Us in Canada – had been in talks with Wilko and PwC about a deal that would save around 200 of the company’s 400 stores and between 3,000 and 4,000 employees.

However, the Guardian reported that the potential deal with Putnam was under strain last week as key Wilko suppliers demanded upfront payment of outstanding debts to guarantee continuing to provide products.

Last week retail chain B&M struck a deal to take up 51 Wilko outlets in a £13 million deal, but these are expected to be subsumed into B&M’s own store portfolio and will not bear the Wilko name.

“Although separate bids may be made for leases of groups of sites, these deals will not secure jobs, although the option to take up new employment with the bidders for these sites is something we are now pushing for,” GMB said.

It added that there was now “no prospect” of saving the remaining store estate in its entirety and all Wilko stores will close by early October.

Having struggled for some time, Wilko recently amended the terms of a £40 million credit facility it received earlier this year in order to “bolster the availability of financing”.

In efforts to shore up its finances, Wilko recently also cut more than 400 jobs, sold its Nottinghamshire-based distribution centre to DHL for around £48 million, and set in motion plans to negotiate rent cuts across its store portfolio via a mechanism known as a company voluntary agreement (CVA).

The recent actions have been construed as part of a “restructuring plan”, with Wilko chief executive Mark Jackson telling Sky News the CVB was initiated in January as part of a strategic plan to first stabilise the business and then implement a growth strategy.

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