Waterford Wedgwood, the china and crystal retailer and wholesaler that went in to administration on Monday, is set to be rescued by US private equity firm KPS Capital Partners.

Administrator Deloitte revealed that it has entered in to a letter of intent with the New York-based private equity firm to buy the business, which employs 1,900 staff in the UK alone.

KPS Capital Partners has proposed the acquisition of the global group, as well as certain assets of Waterford, Wedgwood and Royal Doulton.

Deloitte said it was working to “expeditiously” agree the terms of the deal in the interest of stakeholders.

Waterford Wedgwood chief executive David Sculley said: “This is a critical step forward for Waterford Wedgwood. We commend KPS for its confidence in our company, for the enormous amount of time, effort and resources expended by KPS globally that have resulted in reaching this important stage. I look forward to working towards the successful completion of a deal.”

Joint administrator Angus Martin said: “This is an important step towards our key objective of maximising value for stakeholders.”