BRIERLEY Hill's intu Merry Hill shopping centre has been dealt another devastating blow with news its flagship department store Debenhams faces closure following the collapse of a rescue deal.

The 242-year-old department store chain is to start a liquidation process after JD Sports confirmed it had pulled out of a possible deal.

JD Sports was the last remaining bidder for Debenhams, which has been in administration since April.

Around 12,000 workers across the country, including those at the Merry Hill store, now face a worrying run-up to Christmas as administrators start winding down operations.

Geoff Rowley, of FRP Advisory, joint administrator to Debenhams, said: "All reasonable steps were taken to complete a transaction that would secure the future of Debenhams.

"However, the economic landscape is extremely challenging and, coupled with the uncertainty facing the UK retail industry, a viable deal could not be reached.

"The decision to move forward with a closure programme has been carefully assessed and, while we remain hopeful that alternative proposals for the business may yet be received, we deeply regret that circumstances force us to commence this course of action.

"We are very grateful for the efforts of the management team and staff who have worked so hard throughout the most difficult of circumstances to keep the business trading."

It is understood the collapse of rescue talks were partly linked to the administration of Arcadia Group, the biggest operator of concessions in Debenhams stores including Top Shop and Miss Selfridge, which went into administration on Monday evening.

Debenhams has said it will continue to trade through its 124 UK stores and online to clear its current and contracted stocks but on conclusion, if no alternative offers have been received, UK operations will close. 

It is not known how many jobs are at risk at Debenhams at Merry Hill.