In an email to staff seen by the Press Association, David King said the publisher will apply for court approval to be sold to a newly-incorporated group of companies controlled by creditors.
It informed staff they would continue to be paid and should turn up to work as normal, with their contracts to be transferred to the new company.
Mr King is set to stay on as chief executive and said “operations will continue uninterrupted”, with newspapers and websites being published as usual.
He said: “This has not been an easy decision for the board.
“However, having explored a range of other options, this is the best available course of action and it is one that offers a chance for a brighter future for our business.”
One of Britain’s biggest publishers, it has more than 200 titles in print and online, including the i, The Yorkshire Post and The Scotsman.
The publisher had recently been looking at ways to refinance £220 million of debt which is due to be repaid in June next year.
In the email to staff, Mr King said: “At its peak, the company’s debt reached £793 million.
“We have all worked incredibly hard to reduce those debts. And we have done so against a relentlessly tough market backdrop.”
At its most recent trading update, Johnston reported a hit to revenues, mostly due to changes in Google and Facebook algorithms.
Mr King said this meant the company had to “re-cut our cloth to match the new reality”.
“If this deal is approved, the debt will be reduced, new money will be provided by the new owners, and the business will be in a more stable position,” he added.
In a statement from the company on Friday, the publisher said “following considerable interest in the formal sales process”, it was decided that none of the offers received delivered sufficient value.
“The board has concluded that there is no longer any value in the ordinary shares of the company,” the statement added.
Johnston will be de-listed from the London Stock Exchange as part of the process on Monday, Mr King said.
He also revealed the 250 members of the current workforce in the defined benefit pension scheme will see future payments affected by the restructure, in line with pension protection fund (PPF) payment rules.
Speculation that the publisher might be sold had been growing since it announced the strategic review in March 2017.
In August 2018, the company’s share price spiked, surging by as much as 70% in afternoon trading amid rumours that a mystery buyer was quietly snapping up more stock.
Following the announcement Health Secretary Matt Hancock, formerly a culture secretary, tweeted to say the news was “very concerning”.
“Makes stark reality of the intense pressure on the press,” he added.
Shadow culture secretary and deputy Labour leader, Tom Watson, also tweeted his concern about the “late Friday announcement”, adding that he “will be reaching out to unions and staff over the weekend”.
In a second tweet he said: “Johnston Press going into administration is a grim day for local newspapers and another deeply worrying one for local democracy.”
Leeds North West Labour MP, Alex Sobel, tweeted to say he was sad that Johnston which owns The Yorkshire Post and the Yorkshire Evening Post was going into administration.
“Local papers raising local and regional issues are vital for our democracy,” he added.