Luminar, which runs Liquid, Oceana and Lava & Ignite clubs in town centres across the UK, said it had no option but to call in administrators after incurring huge losses since the recession.
Its lenders told the group they would not extend a recent period of leniency due to end on Thursday, which will leave Luminar in breach of covenants.
Students tightening their financial belts and youth unemployment are thought to be the key reasons the company has been hit so disastrously.
It recorded losses of £198 million in the year to the end of February as sales dropped by 19% to £137 million.
Trouble has been on the horizon for several months despite Luminar’s creditors agreeing to waive banking covenants on a temporary basis to allow the business time to turn itself around. This period of leniency expires this Thursday.
Oceana in Southampton has attempted numerous promotions but seemingly to no avail. Whether the venue will remain a nightclub has not yet been announced.