Morson paid a total cash consideration of £7.75m for the company, which had more than 2,000 contractors on its books at the time of its acquisition and an annual turnover of more than £70m, according to a statement made to the London Stock Exchange, which added the company had been “loss making for some time”.

Ged Mason, Morson’s chief executive, told Recruiter that the company would continue to look for acquisitions in the sector to take advantage of its positive balance sheet.

“Unfortunately there are a lot of businesses in the sector that are struggling. We are hopeful that we can work with them and would be interested in hearing from them,” he said.

The two companies had previously worked together on a number of contracts and Julian Morison, chief executive of the newly formed Morson Wynnwith, said: “As previous competitors, the synergy of the combined businesses will be a potent force moving forward.”

Negotiations over the structure of Morson Wynnwith are currently taking place and Mason said he could not confirm whether there would be any redundancies, adding that there was no overlap between the two companies’ branch networks. Wynnwith entered administration on the 8 June and the acquisition was announced to the stock exchange the following day. The share price of Morson, which is listed on AIM, fell by £0.02 to £0.98 in the two weeks following the acquisition.

Analysis by Recruiter has shown 15 businesses were put into administration during the second quarter of 2009, compared to 22 in the first three months of the year. For a complete breakdown of the companies which were affected and explanations from industry experts on the causes of businesses failures, see the News Analysis on page 12.