Global executive search firm CTPartners Executive Search has announced it may be forced to cease operations entirely or seek bankruptcy protection having failed to reach agreement for the sale of the company as a whole to search firm DHR International.

A statement released yesterday by CTPartners said the company’s business and financial condition “continued to deteriorate as consultant departures have continued through the second quarter of 2015”.

In February, CTPartners announced it had received an unsolicited, non-binding proposal from DHR International to acquire all of the outstanding shares of the company for US$7 (£4.47) per share.

CTPartners’ board subsequently formed a special committee, formed solely of independent directors, to review “strategic alternatives”, including the DHR proposal.

In May CTPartners announced the special committee had “agreed to negotiate exclusively with DHR for a limited period of time in an effort to reach a definitive agreement”.

In yesterday’s statement, DHR indicated “it expects to employ many of the company’s [CTPartners’] consultants and employees”. But CTPartners revealed it had been informed that DHR is seeking to acquire only some of its assets in a transaction with the company’s lenders.

CTPartners said there is no assurance that the transaction will be completed, and, if completed, the proceeds of such a transaction are not likely to be sufficient to satisfy all of its obligations to its lenders and other creditors, and are not expected to result in any payment to the company’s shareholders.

The statement added CTPartners expects that it would need additional funding to continue operations beyond 30 June 2015 but doesn’t expect obtaining the necessary funds from current lenders or otherwise.

Consequently, the company said it plans to wind down remaining operations in an “orderly” manner and may be required to cease operations entirely or seek bankruptcy protection.

CTPartners employs around 600 staff throughout the world.

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