DHR International Inc., a Chicago-based executive search firm, moved forward with plans to acquire CTPartners Executive Search Inc. (NYSE MKT: CTP), while CTPartners announced it may end operations by the end of the month and could seek bankruptcy protection.

The two firms had been negotiating an acquisition but the set time period for the negotiations expired last week with no definitive agreement reached. DHR yesterday announced an agreement in principle on non-binding terms to acquire select assets of CTPartners from its lenders, who have the right to acquire the assets pursuant to the underlying debt documents.

The transaction is estimated to add 17 offices and 250 employees worldwide to DHR International.

“We’re very excited about welcoming CTPartners employees and clients to DHR,” said DHR CEO Geoffrey Hoffmann. “This process has been performed with extensive diligence and more than 200 phone calls between employees of both firms.”

DHR in February submitted an unsolicited, formal written acquisition proposal to CTPartners’ board of directors to acquire all of the outstanding shares of the New York-based executive search firm for $7.00 per share. The takeover bid valued the company at a total of $61 million. In May, the CTPartners’ board agreed to negotiate exclusively with DHR for a set period of time to reach an agreement.

CTPartners yesterday reported business and financial condition at the firm have continued to deteriorate as consultant departures have continued through the second quarter of 2015. If completed, the proceeds of the planned transaction are not likely to be sufficient to satisfy all of the CTPartners’ obligations to its lenders and other creditors, and are not expected to result in any payment to the company’s shareholders.

“The company expects that it would need additional funding to continue operating beyond June 30, but does not anticipate obtaining adequate funds from its current lenders or otherwise,” CTPartners stated. “Consequently, the company intends to wind down its remaining operations in an orderly manner, but it may be required to cease operations entirely or seek bankruptcy protection,” it stated.

CTPartners Chaairman and CEO Brian Sullivan stepped down in April, and executive Sylvain Dhenin — at one time in line to become CEO at the executive search firm — joined Heidrick & Struggles International Inc. (NASD: HSII).

Adding to the company’s woes, a former employee in December filed a complaint against the company with the US Equal Employment Opportunity Commission. And the New York Post reports shareholders last week filed an amended class-action suit that claims Sullivan and COO William Keneally withheld information about discrimination allegations to “artificially inflate” the stock price.

CTPartners ranks as the seventh-largest retained search firm in the US and DHR ranks as the sixth-largest US retained search firm.