Sadie Frost's clothing firm has been placed in administration with debts of more than £4m, it was revealed today.
The FrostFrench label and brand will continue to exist, however, after Frost and her design partner Jemima French set up a new trading company.
A new Norwegian investor has joined Frost and French to create FrostFrench London Retail after the pair blamed problems resulting from management changes two years ago for their original company's trading difficulties.
They said their store, in Islington, north London, would remain open despite the closure of the King's Road boutique.
FrostFrench underwear and accessories will also continue to be sold at Debenhams.
In a statement, FrostFrench, which was launched in 1999, said: "Following external investment in FrostFrench in 2006, in which they had to relinquish their overall control and influence in the company, a new management team was installed.
"Since that point, Sadie and Jemima have been unhappy with the strategic direction and many of the day-to-day decisions.
"Unfortunately the business under the new installed management did not trade successfully and as such, the existing FrostFrench company (FrostFrench Ltd) was last week placed into administration.
"Working alongside a new private investor, Frost and French have set up a new company, FrostFrench London Retail Ltd."
A spokesman for FrostFrench said: "Sadie and Jemima relish the opportunity to be fully hands-on again and being able to return to the creative and business helm of a fashion label.
"Both designers are currently working on their next collection, which will be sold in the Camden Passage, Islington store and via the online boutique http://www.frostfrench.com, which will be relaunched in August."
The administration of the previous company - FrostFrench Ltd - is being overseen by Asher Miller of London-based insolvency practitioners David Rubin & Partners.
In a statement, the firm described the administration as a "rescue procedure" rather than an immediate winding up.
It said the business and assets of FrostFrench Ltd were "transferred as a going concern" to the newly formed FrostFrench London Retail Ltd.
"This has ensured the future of the brand and has preserved the jobs of its workforce," the statement continued.
"Sadie Frost and Jemima French will once again take up positions of control at the forefront of FrostFrench and the brand will be boosted by a major new investment from a Norwegian consortium."
Mr Miller said FrostFrench Ltd's liabilities totalled "a little over £4 million".
Actress Frost, 43, was previously married to film star Jude Law, with whom she had three children,