Loss-making UK department stores group Allders yesterday confirmed that it has collapsed into administration.

Media reports earlier in the week suggested that the struggling chain was on the brink of collapse, threatening the loss of 5,700 jobs.

However, administrators from Kroll said they held out hope of finding a buyer for the whole business rather than having to divide up the group's assets.

Kroll said it has already been contacted by 10 potential bidders, with interested parties said to include rival retail groups House of Fraser and Debenhams, and private equity firm Alchemy.

Harvey Lipsith, a former chief executive of Allders, is also said to be considering launching a takeover proposal for the group.

The administrators said that stores would stay open while all possible courses of action were reviewed.

The pension rights of Allders' employees have been called into question as Minerva, the property company that holds 60 per cent of Allders through its stake in Scarlett Retail, says it has no liability for the pension fund deficit.

Allders, which is based in Croydon, sells clothes, furniture, housewares, kitchenware, appliances, gadgets, and gifts in around 45 stores.