Connaught will repair its final home in the region next month as its three-year deal finishes.
But the firm said Solihull’s decision was made months ago and was nothing to do with its current financial woes.
A spokesperson for Connaught said: “In April this year we successfully completed a 3 year contract with Solihull Community Housing (SCH) to carry out repairs to homes across the south of Solihull.
“SCH had taken a strategic decision prior to our contract ending to bring all such activity back in house. This is understandable given the fact that Solihull Borough Council’s DLO carries out the vast majority of housing repairs work in the town.
“Indeed we reached an agreement with our client to extend our contract until October 2010 in order to ensure a smooth transfer of services and the eight staff employed on this contract.”
“We understand that this decision was taken on purely pragmatic grounds and we know we delivered a high standard of quality and service on this contract.
“We remain on excellent terms with both Solihull Community Housing and Solihull Borough Council, for whom our Environmental division continues to provide cleaning services.”
The Solihull housing contract is believed to be worth around £1m a year.
Greg Lakin, Head of Maintenance Services at Solihull Community Housing said: “We made the decision not to extend our contract with Connaught many months ago. This is because we are bringing this small element of our maintenance activity back in house as part of a wider value for money review.”
Connaught is currently seeking to re-finance the business following a series of profit warnings and a share price collapse.
Barnet Homes announced last month it would be terminating its £7m-a-year maintenance deal with Connaught.
One rival contractor told the Enquirer: “Connaught are trying to play this down but it is another blow for them.”