Speymill Contracts concentrated on construction and refurbishment work for the hotel and leisure industries and hit a peak turnover of £41m in 2007.

But the combination of a steep downturn in work and loss-making contracts has forced the directors to take the decision to place the Huntingdon-based contractor into administration.

The remainder of AIM-listed Speymill Group, consisting of its property investment portfolio, continues to trade normally.

Earlier this year more than £2m was injected into the struggling contractor to prop up the business.

But the firm suffered a £1.76m loss in the first six months of 2012 and saw results deteriorate further in the harsh trading environment.

A group statement said: “The board has regrettably concluded that the Contracts business is not viable and represents an unsupportable burden on Speymill.

“Thus the board of Contracts has lodged with the Court a ‘Notice of Intention to Appoint Administrators”.