Frasers Group’s acquisition of German sporting chain SportScheck has been placed in limbo as the retailer borders on the brink of collapse.

Mike Ashley’s sprawling retail empire announced its acquisition of the 34-store chain last month to help fuel the group’s European growth.

Shortly after the announcement, SportScheck owner Signa Holding revealed that it was in the midst of a funding crisis and filed for insolvency for its Signa Sports division.

According to The Telegraph, it seems the German retail chain may also be at risk of calling in administrators.

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As part of the deal with Frasers, Signa agreed to finance SportScheck until the transaction is completed which is likely to be in January.

However, as the SportScheck owner scrambles to preserve cash, sources said that suppliers were hesitant to do business with the retailer and that management may need to call in administrators as early as Monday.

Frasers are understood to have been exploring on Friday if the deal can be rescued.

Under Germany’s bankruptcy laws, the retailer may seek assistance from its suitor to fund the collapse, which would leave Frasers well-placed to snap up the company via an insolvent sale.

Mike Ashely’s retail empire emerged as one of the businesses circling Signa Sports-owned online bike retailer Wiggle, which fell into administration last week.

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