Coventry City Ltd have gone into liquidation following a meeting with major creditors ACL.
The meeting, which is said to have taken place this morning, resulted in ACL, who are the owners of the club's home ground the Ricoh Arena, rejecting a Company Voluntary Agreement (CVA).
The CVA would have allowed the League One outfit to come out of administration, but the ACL's refusal has resulted in one of the club's companies Coventry City Ltd facing liquidation.
It is believed that the Football League have been notified and they are considering the number of deducted points to issue the club with.
A statement from the club said: "It is with great regret that a proposed Company Voluntary Agreement (CVA), which would have brought CCFC Ltd out of administration and would have recovered a substantial sum of money for its creditors, has been rejected by Arena Coventry Limited (ACL).
"It means CCFC Ltd is likely to be put into liquidation which is expected to result in a points penalty for the club going into the new season."
Reports have claimed that a minimum of 15 points could be taken away from the Sky Blues, who were hit with a 10-point penalty last season for falling into administration.