Internacionale, the beleaguered Glasgow-based fashion chain, has been sold off to an unnamed buyer - but its sister company Au Naturale is to be plunged into administration with the loss of up to 1500 jobs, The Herald has learned.

The hitherto secretive manoeuvre is part of a plan by Ossian Retail, the parent of the two companies, to break up the group following a cashflow crisis, in which it has been unable to meet many of its rent and service-charge obligations for its 120 outlets.

David Brock, Ossian's non-executive chairman, last night told The Herald: "I can confirm that Internacionale has been sold, but I'm afraid I'm not at liberty to say to whom at this stage. There are regulatory issues that must be dealt with.

"I can tell you that this deal has saved almost 1000 jobs, and I'm very pleased about that."

Asked about the fate of Au Naturale, Brock said: "I'm afraid it is most likely going to end up in administration."

The Herald understands that many of Au Naturale's 1500 staff were yesterday given notice of redundancy.

Meanwhile, one name persistently linked with the acquisition of Internacionale is Visage Retail, a company based in South Shields, Tyne and Wear, that has been a long-time supplier to Internacionale and Au Naturale.

Asked about the possible acquisition, a spokeswoman for Visage yesterday said: "There is no-one here who can comment on that."

Ossian's problems are now widely regarded as another sign of stress in the UK retail sector and the global credit crunch - although mismanagement has also been blamed.

However, Brock last night said: "Both companies, Internacionale and Au Naturale, had been trading extremely well. But basically, we lost the support of the banks. That's what precipitated all the problems in the first place."

Entrepreneur and founder Ken Cairnduff sold the business for £45m to a management buy-out team, which later changed its name to Ossian Retail, in 2006 with the backing of Barclays, Bank of Ireland and Penta Capital.

According to documents seen by The Herald, Ossian owes its creditors almost £19m.

However, new investor Agilo, which specialises in distressed companies, now owns Ossian's £25m debt. Agilo filed notice in court last month to appoint accounting firm PriceWaterhouse Coopers as administrators.

Agilo did not return calls for comment. However, its website describes the company as a "London-based fund that invests in distressed firms and special situations", and former Conservative cabinet member Michael Portillo is listed as one of five members on the group's "advisory panel".

Earlier this week, The Herald revealed that the creditors had been summoned to a take-it-or-leave-it meeting today, and will be offered just 25p in the pound from the company.

According to Brock, around 80% of the creditors have already accepted the terms of the offer - although one supplier, who asked that his name be withheld, described the offer as "disgusting".

In an interview earlier this week, the supplier told The Herald: "I'm now owed hundreds of thousands of pounds. I also know there are quite a lot of suppliers owed £500,000 or more."

He added: "It's disgusting that this company, Agilo, is busy selling our goods in their outlets and they have no intention of giving us, the suppliers, any more than 25p in the pound.

Meanwhile, one employee of Ossian, who did not reveal his name, yesterday said: "As of today, we have been told we shall be paid by Ossian up till Monday, and then by Agilo for four days then the administrators PriceWaterhouseCoopers shall pay us after that.

"So it is definite that from May 9, we shall be in administration as we are sending out Closing Down - Sale of all Stock' graphics to the remaining stores for them to display."

Members of PwC's Scottish corporate recovery team did not return calls for comment.

Meanwhile, the latest accounts of Ossian show that since the MBO, three members of the original buy- out team have ceased to be directors of the company.

Norrie Stewart, Graham Clements and Gerard Gavan were all listed as former directors.

Finance director David Milton is the only member of the MBO team to remain on the board. Non-executive chairman Brock - who was appointed by Penta Capital - is understood to be running the group.

However, it is Milton's name that appears at the bottom of 25p-in-the-pound offer document.

It was unclear last night if Penta's stake in Ossian involved equity or preference share, in which it would be considered a secured creditor giving it an easier path to repayment.

According to the documentation, the meeting is to be held at Merchants Hall on West George Street, Glasgow, at 2pm today.

Asked if he would be attending today's creditors' meeting, Penta's Torquil Macnaughton last night said: "It has been a while since I was on the board and I won't be personally attending the meeting, no. But we won't be getting 25p in the pound."

It was unclear whether Penta expects more or less than 25p in the pound for its investment.