Mothercare will put its UK business in administration, leaving 2,500 jobs at risk.
The children's retailer, which has 79 stores, said it will file a notice of intent to appoint administrators for the UK business later on Monday.
The company made a £36.9 million loss in the financial year to March, struggling in a difficult period for the British high street.
With around 500 full-time staff and 2,000 part-time employees, the chain is set to follow the likes of Bonmarche, Jack Wills and Karen Millen, which have gone bust in recent months.
The global business will not close, but said it had undertaken a review of the UK business and found that it is "not capable of returning to a level of structural profitability".
It is believed the brand's international presence, which includes stores in Ukraine, Pakistan and Hong Kong, will all continue trading.
Earlier in the year, the company was given the green light to axe some of its failing stores.
It came as part ofa wide-ranging restructuring plan that will also see Mothercare bag a refinancing package worth up to £113.5 million.
Shares in the parent company dived by 29.2% to 8p in early trading on Monday on announcement of the news.