The firm is presently working on 30 sites in Scotland and at its peak turned over up to £18m working mainly on house building schemes for major developers like Taylor Wimpey, Stuart Milne, Miller Homes and Persimmon.
Donaghy appointed KPMG as provisional liquidators yesterday who laid off 175 staff immediately. Ten staff have been retained to assist the liquidators with securing the Govan firm’s remaining assets.
KPMG will now work with clients to ensure remaining contracts are either completed or novated.
Blair Nimmo, head of restructuring with KPMG in Scotland, said: “Despite Donaghy’s strong reputation in the Scottish construction sector, the business has unfortunately experienced an extremely challenging trading period in recent months and throughout last year, largely due to the well-publicised downturn in the construction sector.
“The business was experiencing declining margins as tenders became increasingly competitive,ultimately leading to severe cashflow pressures.
“Regrettably, we had no option but to close the business and to make most of the employees redundant.
“We will now be working with the relevant Government authorities to ensure staff can claim outstanding sums due to them.”