Administrators have been called in at property services firm Erinaceous after it became the industry’s highest profile victim of the credit crunch.
The firm, which provides a range of services including m&e engineering, design and maintenance, had been struggling for some time.
In January it announced that its debt levels had become unsustainable and that it was looking to sell off its profitable insurance business Erinaceous Insurance Services in order to reduce this burden.
Today it announced that this part of the business would be sold to its lenders, and that its residential management and property maintenance operations would also continue to trade.
But KPMG has now been brought in to act as administrators to deal with the rump of the business.
A company statement today said: “Following the announcement on 14 January 2008, the board has vigorously explored all of the available strategic options including the possibility of refinancing the group's borrowings, options for sale and an equity rising.
“However, given the extent of the challenges facing the group and the current state of the capital markets it has not been possible for the group to reach an agreement with its lenders and other creditors and therefore the Board has now concluded, with regret, that it is necessary for the company to file for administration”.
Earlier attempts to sell the whole business to buyers including HBOS, venture capitalists 3i and Bridgepoint and Iranian entrepreneur Vincent Tchenguiz last year came to nothing.