Carter & Carter said on Monday it would appoint administrators after it failed to reach agreement with its banks over a financial restructuring.

Shares in the vocational training group, which organises apprenticeships for government agencies, were suspended last October at 82½p, since when it had been in talks with its lenders which included a possible debt-for-equity swap.

The group said that its lenders had now decided a “consensual restructuring is no longer a viable option”.

Rodney Westhead, acting chairman, said he was “bitterly disappointed” that the efforts by staff and its banks – Barclays, HBOS and Lloyds – to agree a restructuring had failed.

Asked if the conditions in the credit markets had affected the chances of a successful refinancing, he said “I can’t imagine it helped”, but said it would be speculation to say that the turmoil had caused the group’s demise.

Carter & Carter was now in the process of appointing an administrator which should take place in the next 24 to 48 hours, Mr Westhead said.

He added that training that people are currently receiving was continuing and the government agencies involved were keen to ensure continuity. A large proportion of the group’s work is for these agencies.

Shareholders are expected to receive little or nothing from the administration

At the end of January Carter & Carter had net debt of £86m but said its borrowings were expected to rise to a peak of £175m and asked shareholders to waive borrowing limits. Shareholders approved the request at a special meeting in February and at that point the company hoped to come up with a restructuring proposal “in early March”.

The group, which does work on behalf of the government’s Learning and Skills Council and the Department of Work and Pensions, was awarded the title of New Company of the Year in 2005 after its flotation, and Philip Carter, its founder, was Entrepreneur of the Year 2006 at the PLC awards.

However, Mr Carter’s death in a helicopter crash last May led to an unravelling of the group’s fortunes. The share price had peaked at more than £12.50, giving it a market capitalisation of £526m in April but started to slide after Mr Carter’s death.

Three profit warnings followed, culminating in a statement in October that the company could not “accurately assess its financial position” – at which point the shares were suspended, valuing the group at £34.3m.

In November it said it could not complete its 2007 accounts because it was “reviewing the accuracy of certain revenue streams in the business” and it had found poor record keeping including the “falsification of certain supporting documentation” among learner records in the skills division.

The group said in February that it was working with the LSC to ”identify the extent of the issues in supporting documentation and in determining an accurate position”.

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