The Little People Day Nursery closed its doors last week after five years in business, with the owners citing mounting costs - including the high rent at its Hartlepool Marina location - as the cause.
Hartlepool Borough Council, which was alerted to the situation by the nursery late last year, has failed in its attempt to find it a new owner and avert a winding-up order from HM Revenue & Customs.
The local authority has been helping to find alternative childcare places, as well as new positions for the 20 staff affected.
"The council has done everything possible and worked tirelessly with the nursery manager to try and secure a takeover for the business but unfortunately this has not been possible," said a council spokesman.
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