One of the former investors behind Gala Coral is winding up operations have taking a large hit on its investments. The company has stated that it will sells the remaining assets in the portfolio and return the funds to shareholders.

The group took a 13pc hit in its first-half net assets after significant write downs in a number of assets. The company said that it would make a 30 percent loss on the €1.2bn Ontex. Candover also took a 40 percent loss on its investment in Gala Coral earlier this year; Candover and Cinven wrote off £150 million each and Permira taking a hit for around £370 million.

The company had previously been involved in talks to sell itself to a Canadian Pension Fund. However the company has stated that offers for the company would not generate as much as selling off stakes owned by its fund manager Candover Partners.

Chief executive of Candover Investments, Malcolm Fallen said selling off the companies assets was in the best interests of the shareholders.

"The best way to optimise value is likely to be a move towards implementing a plan to return cash to shareholders," he added. "There is significant value in the underlying investments in the portfolio."

An analyst at Oriel Securities, Iain Scouller commented: "Whilst this is a sorry demise for what was one of the UK's leading private equity funds until a couple of years ago, we think it is the most sensible course of action."