The setting, which is based in Thrapston, Northamptonshire, is considered to be no longer viable by the nursery group, part of Midcounties Co-operative, and as a result will close at the end of August.
It follows significant investment in the nursery, including a £125,000 refurbishment last year, after the Co-operative acquired the setting, along with three others in Oxfordshire, from the Petite Enfant group in 2012.
Rated good by Ofsted, the nursery, a converted school building, is registered to care for 79 children and employs 23 members of staff, all of whom could face redundancy.
Co-operative Childcare has yet to make a decision about the future of the building.
The closure of the Thrapston nursery brings the total number of settings owned by The Co-operative Childcare to 49, providing around 3,600 places.
A spokesperson for the Co-operative Childcare said, ‘Closing the Thrapston nursery is not a decision we have taken lightly. However, despite significant investment in a number of marketing activities and full refurbishment of the nursery to encourage an increased occupancy, we have regrettably concluded that the future of the setting is no longer viable.
‘We are working hard with parents to enable the smoothest transition possible, helping to find alternative childcare arrangements, with the emphasis, as always, on ensuring the children are well cared for and supported through this period of change.’