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Woolworths, the iconic 99-year-old six-penny retail chain, is on the verge of collapsing into corporate bankruptcy despite desperate last-ditch government efforts to save it.

The board of Woolworths plc, believing it had exhausted all its other options, met at 6pm at the retailer’s central London headquarters to vote on a move that threatens thousands of British jobs.

Here they will agree to put two of Wooworths’ subsidiaries - its 815 store high street arm and its DVD distribution business EUK, which between them employ nearly 30,000 people - into corporate bankruptcy or administration.

Times Archive

• 1919: Frank Winfield Woolworth, pioneer of the sixpenny store

• The Woolworth Building, a wonder of the world

• That's the wonder of Woolies

Times Archive, 1968: Woolworth disappoints again

• Times Archive, 1969: Changing patterns of High Street trade

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2Entertain, a joint venture with BBC that sells DVDs such as Blue Planet, has a handful of staff who for the moment will be safe in their jobs.

Woolworths’ demise came despite a last-gasp intervention from politicians. Baroness Vadera, a minister from the Department for Business Enterprise and Regulatory Reform, the department run by Lord Mandelson, called Woolworths’ banks on Tuesday night to order them back to the negotiating table.

The minister spoke to GMAC, the financial arm of General Motors, and Burdale, a division of the Bank of Ireland, who were leading negotiations with Woolworths on behalf of eight lenders. She also spoke to UK high street bank Barclays, which is another lender.

Lord Mandelson is believed to have personally called Woolworths’ management this afternoon to get assurances they would do whatever they could to protect Woolworths’ 9,500 pension fund members, save jobs and keep stores open in the run-up to Christmas, even if the retailer fell into administration.

Formal papers will be filed with the court first thing on Thursday morning appointing accountancy firm Deloitte as administrator.

The administrator is likely to close about a third of Woolworths’ worst-performing stores in the coming weeks, but all the stores are expected to open as usual tomorrow. Deloitte will probably run profit-making EUK as before.

The accountant will look for a buyer for EUK and the remaining high street stores, who will probably want to keep the Woolworths name.

Retailers are predicting a tidal wave of high street collapses before Christmas as the recession-hit British consumer holds back on spending while struggling banks tighten their own belts and foreclose on more businesses they lend to.

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