Lola Group Holdings Limited has been placed into administration today, it has been confirmed.

A statement issued to the press said the economic crisis and the decision by HM Revenue & Customs not to pay ongoing R&D tax credits was to blame, causing a 'serious cashflow' problem.

The board is now said to be continuing discussions with 'possible investors and prospective purchasers' to save the company. No further comment will be made until Monday next week.

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The full statement read:

"Lola was formed in 1958. In recent years, significant investment has been made in technology and capability in the motorsports business as well as diversifying and creating Lola Composites Limited, serving the defence, aerospace, communications, renewable energy, automotive and motorsports markets.

"The latest economic downturn and the decision of HMRC not to pay ongoing R&D tax credits has caused a serious cashflow problem for the businesses.

"It is with enormous regret that a decision has been taken to issue Notices of intention to appoint an Administrator to Lola Cars International Limited and Lola Composites Limited. This step allows the board to continue its discussions with possible investors and prospective purchasers with a view to securing the best outcome for the staff, creditors and customers of both businesses.

"The Lola board have declined to make further comment until Monday 21st May."