Thousands of jobs were at risk last night as social housing firm Connaught prepared to go into administration.

Connaught and its subsidiary Connaught Partnerships has outlets across the West and is involved in a £10 million social housing improvements programme in the Bath area.

The group's board said it was in the process of appointing KPMG administrators and it is understood they were formally placed into administration yesterday.

However other subsidiaries including Connaught Compliance, National Britannia Holdings, Fountains Limited and Connaught Environment Limited, will continue to trade as normal.

The debt-ridden Exeter-based repair and maintenance specialist, which also has a major base in Bristol, has been in turmoil since warning in June that Government spending cuts could blow a £200 million hole in revenues over this year and next.

Since July, bosses at Connaught have been in discussion with its lenders and other potential financiers to try to keep the company afloat.

About 10,000 people are employed by Connaught, with about 180 multimillion-pound social housing contracts in the UK.

Until their suspension yesterday, the company's shares had fallen by more than 90 per cent.

It followed a warning in June that it had identified 31 projects where spending will be delayed as a result of austerity measures, wiping £80 million off revenues and £13 million from underlying profits in this financial year.

Sales and profits were also expected to fall by a further £120 million and £16 million respectively next year, it added.

Connaught debts were estimated to be about £220 million.

It is expected that rival firms such as Mears will look to take on some of the extra work now that Connaught has announced it is to go into administration.