The UK bookshop chain Borders was placed in administration today, raising doubts over 1,150 jobs.

The firm, which has 45 branded Borders and Books Etc stores across the UK, has come under severe pressure from internet competition during the past year.

Borders has been placed into administration. Photograph: Sarah Lee

Administrators MCR said the business continued to trade while a buyer is sought for all or some of the company’s stores.

Borders’s future has been uncertain for several days since it emerged that a deal to sell some stores to WH Smith had probably collapsed. On Tuesday it suspended orders on its website.

Since July Borders has been owned by Valco Capital Partners, part of Hilco, which specialises in distressed retailers. On Monday a court in Manchester granted Valco’s request to start the process of naming BDO as administrators.

Borders’s accounts show the company made a loss of £13.6m in 2008, up from £10.3m in 2007. Its auditor, Ernst & Young, raised doubts about its ability to continue as a going concern.

Borders has struggled with “severe” cash flow pressure this year as sales falls accelerated, administrators said.

Stock levels were also hit as several of the company’s suppliers stopped or reduced its credit limits, while a number of credit insurers have also reduced their cover for the firm.

Joint administrator Phil Duffy said: “All stores currently remain open for business as normal whilst the administrators undertake a review of the company’s affairs and seek a purchaser for all or some of the company’s stores in which there has already been interest.

“All outstanding employee wages have been paid up to date and ongoing wages for retained staff will continue to be paid as an expense of the administration.”

He added that booksellers in general had been hit in the current weakened retail market, with competition on major releases from supermarkets and the internet.

Borders first opened in the UK in 1997 and was originally owned by the US book giant of the same name.

But the UK and Ireland arm was sold to buyout group Risk Capital Partners – headed by Channel 4 chairman Luke Johnson – in 2007.

Management, led by chief executive Philip Downer and finance director Mark Little, then bought the group back with financing from Valco Capital earlier this year.