Strategic Retail, which had been reviewing all options for the stores, said it had taken the decision "in the light of current trading conditions".
The collapse adds to the roll-call of casualties including Woolworths and furnishing chain MFI in recent weeks.
The move came just two weeks after the business unveiled widening losses across the stores, as it attempted to reposition itself as a "value for money" retailer with little success.
It said the recent deterioration in sales had been especially acute in its larger out-of-town Texstyle World stores, where trading was 11 per cent down on a like-for-like basis in the six months to August 30.
Leveys was down 7.8 per cent over the same period while Fads proved more resilient with a two per cent fall.
Losses hit £855,000 in the period, compared with £26,000 a year earlier.
As of March 1, the company had more than 350 staff and 51 stores. Strategic Retail was formed in 2003 as a cash shell to acquire companies in the retail sector.
It started with Fads before adding Leveys, a north east based home decor chain, a year later.
In 2005, Strategic Retail acquired several Texstyle World stores based in Scotland before its acquisition of Carlisle-based Furniture Express store.
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