Palmer & Harvey, one of the UK’s largest private companies, has tumbled into administration with 2,500 immediate job losses just weeks before Christmas.

The wholesaler, which supplies 90,000 shops across the country, said that it had been hit by “challenging trading conditions and efforts to restructure the business have been unsuccessful.” Around 900 more jobs are still at risk of redundancy.

One employee, who had worked at the business for four years, told The Daily Telegraph that bailiffs had turned up to P&H’s Hemel Hempstead and Farnham offices earlier today while staff were told to go home at lunchtime and wait for a letter.

Administrators at PwC said that wages for November had already been processed and would be paid due to the support of its secured creditors.

“The Palmer & Harvey name has been a trusted partner for retailers and suppliers for nearly 100 years”, said Matthew Callaghan, joint administrator at PwC. “This is a devastating blow for everyone who has been involved in the business.”

The collapse comes just a month after the company signed an exclusivity agreement with private equity firm Carlyle after months of takeover talks which would have given P&H a more stable balance sheet. The deal was conditional on cigarette giants Imperial and Japan Tobacco rolling over loans worth £60m and providing additional funding to keep the business solvent. P&H is the UK’s largest cigarette supplier.