Ernst and Young LLP were appointed as joint administrators of the company on Tuesday, which includes the Babbage Way store in Worksop.
The business has been sold to a new owner who will honour customer orders where part payment deposits have been made for goods and customer warranties.
Joint administrator Ian Hudson said: “Dreams is a well known market leader, but in common with many others has suffered as a result of this depressed retail environment, a rapid expansion of its store portfolio and onerous lease liabilities.”
“However, we are pleased a sale has been completed that sees the majority of the Dreams business including 171 of its stores, its head office and its two UK manufacturing facilities being sold to a new company controlled by Sun Capital Partners. The business will continue to trade without interruption, over 1,600 jobs have been transferred and the future of Dreams on the UK high street has been safeguarded.
“The remaining stores not included in the sale will remain open whilst the Administrators seek to find a buyer.”