Marks & Spencer suffered an unexpected blow on Monday with the collapse of its £103 million sale of its Kings Supermarkets business to privately-owned New York-based food retailer D'Agostino.

The deal fell through after D'Agostino failed to secure financial backing for Kings which M&S acquired 14 years ago for £75.3m but has been trying to sell for more than a year as it looks to focus on its core markets.

"Marks & Spencer has terminated the sale contract with D'Agostino Supermarkets as the deadline for completion expired on 30 November," it said in a statement. "Marks & Spencer is now in the process of considering other options for the sale of Kings."

Other firms which in the past have shown an interest in the 29-store chain include family-owned Gristede's and frozen food distributor Di Giorgio.