Hundreds of jobs have been lost at a construction company as the wind-down of the business got under way.

Some 258 employees at Dundee-based Muirfield Contracts have been made redundant, according to administrators.

And around 110 labour-only sub-contractors will not be offered further work at the firm, taking the total number of jobs affected to nearly 370.

Twenty-five core staff will be retained to help wind down the affairs of the company, a privately-owned construction business which operated across Scotland.

The developments were confirmed by Derek Forsyth and David Hunter of Campbell Dallas LLP, who were appointed as administrators yesterday.

The construction firm, whose recent projects included Angus Council's headquarters in Forfar and the refurbishment of Dundee's McManus Galleries, had been suffering from "unsustainable cash flow problems" despite a turnover of £47 million.

The company had suspended trading operations in the days leading up to the appointment of administrators.

A wind-down of the business is now under way after a review of the company's affairs.

Mr Forsyth, head of business recovery and insolvency at Campbell Dallas, said: "We were not in a position to recommence trading and had no option other than to begin an orderly wind-down of the business.

"As a result we very much regret that 258 employees have been made redundant and that the company is no longer in a position to offer work to around 110 labour-only sub-contractors who had been engaged prior to administration.

"We have written to all employees affected by redundancy and letters to the labour-only sub-contractors are currently being issued.

"We are retaining a core staff of 25 to assist with the ongoing assessment of the contracts position and to help with the wind-down of the company's affairs. We are fully aware of the impact of the redundancies on the local economy and communities. My team and I will be working with all relevant agencies, the trade union, local politicians and third parties to provide as much support as possible to all employees."

Mr Forsyth said the business had effectively ceased trading before his appointment and its position was "untenable and unsustainable".

"We will now focus on the wind-down process and will look to realise as much value as possible from the contracts and sales of any physical assets such as property, plant and vehicles," he said.

"We would encourage interested parties to make contact with us as soon as possible."