Trinity Technology, the specialist IT management service provider, has ceased trading with the loss of 40 jobs. A provisional liquidator, Mr Ray Jackson of KPMG, has been appointed following the failure of the company to secure new funding.

Earlier in the week it was revealed that Trinity was in discussions with a group of investors to raise between £2£3 million.

"This is a terrible outcome for our staff, our creditors and investors. Over the past seven days we have made every effort to attract new funding. However, the current market conditions made the task impossible and regretfully we have no alliterative but to appoint a provisional liquidator," management said in a statement. Last Tuesday, Trinity said "an unforeseen difficulty" had arisen, which involved a major insurance company withdrawing its credit cover from the company. It said every effort was being made to resolve the situation and to secure new funding.

Chief executive Mr Robert Booth said the removal of the credit cover was outside Trinity's control and arose because of misunderstandings.

All of the 40 staff had been paid up to date, the company said. Yesterday's closure follows the laying off of 12 staff last week. At the time, the company said these redundancies were made as a "prudent approach" to ensure the continued success of the company against a background of a slowdown in the technology sector.

The major shareholders in Trinity include joint chief executives Mr Booth and Mr Frank Ennis and a number of smaller investors including employees.