The company told investors trading in its shares on the Alternative Investment Market had been suspended with immediate effect pending clarification of the group’s financial position.

The Kirkcaldy-based firm, which employs around 300 people, said in a statement that talks on funding were “unlikely to result in a positive outcome”.

Last month Havelock Europa flagged potential uncertainty over its ability to continue as a going concern just months after securing £8m in loan funding from Bank of Scotland and Scottish Enterprise.

The funding was the latest step in the turnaround strategy implemented by chief executive Shaun Ormrod, who joined the group in September following the resignation of David Ritchie.

Since then, the company said it has experienced an “unexpected increasing credit squeeze from its suppliers”.

The Havelock statement said: “In its announcement of its results for the year ended 31 December 2017, released on 31 May 2018, the company referred to a material uncertainty that may cast significant doubt over its ability to continue as a going concern and to realise its assets and settle its liabilities in the normal course of events.

“Since then, the company has experienced an unexpected increasing credit squeeze from its suppliers, as a result of which it has substantially utilised its available facilities following the re-financing first announced on 20 February 2018.

“The board announces that it has been in discussions with existing funders and investors in the company regarding the provision of further funding, however it became apparent yesterday evening that these were unlikely to result in a positive outcome.”

It added: “The company’s ordinary shares will therefore be suspended from trading on AIM with immediate effect pending clarification of its financial position.”

Fife Council said it is in daily contact with the company.

Co-leaders David Ross and David Alexander said: “This worrying announcement potentially has a major impact on Kirkcaldy and mid-Fife, as the company is the one of the area’s largest employers.

“The council has been strongly supporting Havelock over the past year with regular officer engagement, and significant assistance from Scottish Government and Scottish Enterprise.

“This will continue as the company considers its options over the coming days, and the Head of Economy, Planning and Employability will be in daily contact with the company and the national agencies as the situation develops, to provide all possible support to the company and its workforce.”