Nationwide Accident Repair Services has collapsed into administration, along with a number of its subsidiaries.
The business, which is headquartered in Witney, Oxfordshire, operates a national network of garages, servicing the accident repair market for large UK insurance firms.
After PwC was appointed as administrators, the majority of Nationwide Accident Repair's business and assets were sold to RunMyCar Ltd, a subsidiary of Redde Northgate.
The deal will save almost 2,350 jobs across 80 sites, including repair garages and offices.
However, 540 roles have been made redundant as 30 sites were closed.
Rob Lewis, joint administrator at PwC, said: "As with many other businesses, the group had to weather major financial fallout due to the economic impact of COVID-19, which meant that trading volumes were significantly reduced.
"Against that backdrop, the sale announced today reflects a significant positive outcome for the business, and we are especially pleased to have safeguarded 2,350 roles including apprentices, mechanics and technicians."
Mr Lewis said "every effort" was being made to support those who had been made redundant.
Rachael Wilkinson, joint administrator at PwC, added: "Companies across the automotive sector are still recovering from an extended period where activity ground to a halt, significantly depleting cash reserves.
"Some are only reaching a fraction of pre COVID-19 volumes despite reopening outlets. Consequently, the sector is set for a make or break re-balancing period over the next few months. Refreshed lending agreements, cash conservation and supply chain management will be key."
