Beleaguered engineering firm Forge Group has decided to enter voluntary administration just a day after placing its shares in a trading halt, following news that key financiers had withdrawn their support.

Forge has reportedly entered talks to appoint Ferrier Hodgson as its administrator, just a day following its announcement to the Australian Securities Commission that it was withdrawing its shares from trading.

The decision by the company to halt trading of its shares had been prompted by news that Forge had lost the backing of key financiers including ANZ Bank.

Towards the end of February the company flagged losses for the 2014 fiscal year of up to $25 million, although at the time it indicated that it still enjoyed the support of ANZ Bank.

ANZ said to the ABC that Forge’s decision to appoint an administrator was “disappointing,” and that the bank had worked hard over the past few months to provide support and assistance to the company’s management.

Forge’s collapse could prove to be a major embarrassment for ANZ, which decided to assume the role of the engineering group’s chief lender last year, supplanting National Australia Bank.

When Forge’s shares shed a staggering 83.6 per cent in November, on the back of massive write downs for key power station projects, ANZ stepped to the plate with the provision of a $60 million working capital facility, as well as the deferral of quarterly principal payments on an existing facility for the following three quarters.

The agreement struck by ANZ had the potential to make the bank Forge’s biggest shareholder.

While Forge enjoys a swathe of lucrative contracts  with some of the biggest players in the Australian mining and energy sectors, including Fortescue metals, BHP Billiton and Chevron, it has been plagued by problems in relation to two of its key power station projects – the West Angelas Power Station for Rio Tinto Iron Ore in the Pilbara, and the Diamantina Power Station in Queensland.

A $127 million write down on the pair of troubled power stations was what prompted Forge’s stunning 83 per cent share loss in November.

News that the company had obtained a  lucrative contract for the construction of a $1.47 billion processing facility at Roy Hill served to bring much needed succour to its share price, spurring a 54% surge just prior to the New Year. The company’s subsequent share performance has been dismal however, with a decline in excess of 47 per cent since the start of the new year.

Last week WestBusiness reported that Forge had appointed Euroz Securities to run a data room for potential investors, attracting interest from at least three rival engineering firms based in Western Australia, as well as a number of private equity players.