Pushkala Aripaka, James Davey

(Reuters] – McColl’s British convenience store chain went into administration Friday after it rejected a rescue plan from Morrisons and its wholesale partners.

McColl’s has 1,100 locations, which include convenience stores under their own names and Morrisons Daily as well as Martin’s newssagents. About 6,000 employees are employed full-time.

Although talks had been progressed with Morrisons, the company stated that “the lenders made it clear they weren’t satisfied with such negotiations reaching an acceptable result.”

McColl’s board said it had no choice other than to place the company in administration, a form of protection from creditors, appointing PriceWaterhouseCoopers (PWC) as administrators.

Morrisons stated that its proposal would have saved the majority of jobs, stores and pensioners.

Morrisons spokesperson said, “This is very disappointing, damaging, and unnecessary for thousands of hardworking pensioners.”

McColl’s has less than 170million pounds (or 210 million dollars) in debt and said that it expects PWC to quickly sell the company.

Sky News reports that EG Group was the fuel station and food retail company owned by Mohsin Issa brothers and TDR Capital private equity group, and it was likely to reach a deal which would save the majority of the business.

EG Group had no immediate comment.

TDR, the Issa brothers, and TDR own Morrisons rival Asda.

McColl’s demanded that the London listing of McColl’s shares is halted with immediate effect. Over the past year, shareholders had seen their investments virtually vanish.

McColl’s was plagued with availability and inconsistent trading. For weeks, McColl’s had been in discussions with lenders to address funding problems.

Morrisons, which trails market leader Tesco (OTC:), Sainsbury’s and Asda, has been owned since October by U.S. private equity group Clayton, Dubilier & Rice (CD&R).

Morrisons’ McColl’s deal has resulted in more than 200 stores being converted into Morrison’s Daily. The target is 450 stores by November 2022. Morrisons 2021 Annual Report estimated its exposure to McColls at 65-130million pounds.

McColl’s will submit documents to court Friday in order to appoint PWC administrators.

Smiths Group (OTC) supplies McColl’s magazines and newspapers. It said McColl’s was at risk of bad debt due to McColl’s retailer. The company owes 6-7million pounds. 1.2 million is overdue.

($1 = 0.8115 pounds)