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In an exclusive interview, Mr Law also told ATG that he was given no reason for the move. He said the firm was in a healthy state and he is now putting together a fresh deal to buy back the landmark Bond Street dealership.

Allied Irish Bank called in the administrators on Monday, July 20 after it was reported that an offer to settle the debt had not been accepted.

It had been reported that AIB, Partridge's main creditor, was offered 65p in the pound to settle the debt on July 17, with Mr Law offering to make up the shortfall from his own funds.

However, Mr Law has now told ATG that the first he knew that anything was wrong was when a letter arrived at 10.30am on Monday, July 20, calling for £2.5m of the debt to be settled by noon that day. A further demand for £550,000 - to be settled by the same deadline - came shortly after, he explained.

"We had no problem with the business and there was no explanation," he said.

When ATG put Mr Law's comments to AIB, however, they denied his explanation of events. "It's simply not true," said a spokesman, although he declined to go into any further detail at this time.

Andrew Stoneman and Matt Bond, partners at Recovery specialists MCR, have been appointed as joint administrators and are running the firm as normal while actively seeking a buyer for the business, its assets and the lease of the building itself.

The dealership is housed in possibly the grandest building in Bond Street, a purpose-built four-storey listed building called the Palace of the Arts, from where it has supplied the finest art and antiques to the likes of Queen Mary, the Burrell Collection in Glasgow and, perhaps most notably, the British Museum and the Getty Museum in Malibu, California.

The company ran into trouble around five years ago, when then chairman John Partridge unveiled what he dubbed the worst set of trading figures in his 46 years at the helm.

Mr Law, a former auctioneer and ceramics specialist, who already ran porcelain specialists Albert Amor, quickly put together a bid to take control of the company. With the backing of a consortium including former Culture Secretary David Mellor - a client of Partridge - he formed Amor Holdings, an investment vehicle that bought out the Partridge family in a £14m staggered deal.

Princess Michael of Kent was later appointed president of the company.

Administrator Andrew Stoneman said: "This is a world famous fine art dealer with a strong and loyal customer base. It is too early to determine the reasons why the company has gone into administration and we are concentrating on saving the business and selling the store as a going concern, thus saving a piece of history as well as the employment of those working there. We are confident that there will be a significant amount of interest."

Ivan Macquisten