Sadie Frost's company FrostFrench - which she runs with her friend Jemima French has gone bust¹.

Sadie Frost's company has gone bust-FrostFrench-which she runs with her friend Jemima French - owed one creditor² alone £3.3 million.

Accounts filed in 2006 show the company lost £363,378.

A source said: "Sadie and Jemima were both absolutely devastated³ when they realised the company was headed into administration.

"They've put their heart and soul into FrostFrench for the past nine years so neither were prepared to go down without a fight."

The pair - whose brand is famous for its frilly knickers and boasts a host of celebrity⁴ clients, including Kate Moss⁵, Helena Christensen and Jerry Hall - are determined⁶ to turn around their losses.

They are setting up a new firm - called FrostFrench London Retail⁷ - in an attempt to make back some money.

The source added to Britain's Daily Mirror newspaper: "They have set up a new company to invest in the label - and to pay back some of the money they owe.

"Sadie is determined to pay back every single penny - but there's absolutely no guarantee this will happen. The next few months are crucial."

Sadie and Jemima have closed the London store they recently opened and their website has also ceased trading.