Byron Burger has filed a notice to appoint administrators, as it tries to protect the restaurant chain from creditors while it seeks a rescue deal.
The chain has 1,200 staff and 52 restaurants across the UK.
Sources confirmed that the Byron Burger board still remain hopeful that it can be sold as a "going concern".
The chain is believed to be in talks with three potential buyers, who could buy the firm or parts of it, in a so-called "pre-pack" administration deal.
This is where a firm sells all or some of its assets to a pre-determined buyer, and appoints administrators to do so.
If the chain does go formally into administration in the coming days, KPMG is set to deal with the process. The accountancy firm has been trying to sell Byron since early May.
The notice to appoint administrators was first reported by Sky news.
A source close to the company said that an investor could buy the brand and parts of the business, but reduce the size of the firm.
That could potentially mean job losses and restaurant closures.
The filing of the notice to appoint administrators gives legal protection from creditors while a sale or pre-pack administration is prepared.
Discussions are currently taking place with creditors about debts, the source said.
The company is aiming for a phased re-opening from mid-July, but it will probably be a smaller company, the source added.
Byron has been struggling for a number of years. In 2018 it agreed a rescue plan and restructuring which was handled by KPMG.
As part of that deal, investment house Three Hills Capital Partners became the biggest shareholder.
On Monday, The Restaurant Group said its own rescue deal had been approved by creditors, meaning 160 outlets would remain open.
As announced on 10 June, up to 3,000 jobs are to go as the group closes 125 restaurants, mainly at its Frankie & Benny's chain. That's out of about 7,000 jobs in that division of the group.
The restaurants that will not reopen are located across the UK, but mainly in England. Many of them are located in out-of-town retail parks, which have been hit by lower footfall as consumers increasingly shop online.
The coronavirus crisis accelerated a process of permanently closing those restaurants that was already happening, a spokesman for the firm said.
The Restaurant Group started a consultation process with staff after the June announcement, and those that have not already been made redundant remain on furlough.
Restaurant chains, which were already under pressure before the coronavirus crisis, have been hit hard by the coronavirus pandemic.
For example, Cafe Rouge owner Casual Dining Group filing its own notice to appoint administrators in May.
A spokesman for Byron Burger declined to comment on the reports.