TROUBLED Internet retailer LetsBuyIt.com has been rescued from the brink of bankruptcy after securing a last-minute funding deal.

The UK company has clinched £2.6m investment and a promise from a German backer of another £31.7m.

That was enough for administrators to cancel a bankruptcy hearing due to take place at Amsterdam District Court yesterday.

The pan-European company, which has provided a window-shopping-only service since seeking protection from creditors last month, said it was confident of resuming normal operations soon.

The announcement came as LetsBuyIt said membership numbers during the three months to the end of December had risen nearly 29 per cent to more than a million.

LetsBuyIt, which allows users to join forces to buy products more cheaply, attracted revenues for the quarter of £24.4m, compared with £1.4m for the same period last year. It was saved after a mixture of existing and new investors guaranteed to provide financing.

John Palmer, LetsBuyIt's founder and new chief executive, said the company had traded well prior to Christmas, despite a 60 per cent reduction in marketing expenditure on the first half of the year.

LetsBuyIt employs 70 people in the UK and another 250 staff on mainland Europe.

It hit trouble in July when it raised less than hoped from its German stock market flotation. It is not yet known when trading will recommence on the LetsBuyIt website