The 135-year-old Guardbridge, St Andrews-based company called in administrators KPMG Restructuring this morning.

Of 260 staff, 80 have been retained to keep the company trading while the administrators attempt to find a buyer.

Blair Nimmo and Gary Fraser of KPMG Restructuring have been appointed as joint administrators by the company's directors.

Nimmo said: "It is with regret that we have had to make substantial redundancies across Curtis Fine Papers operations and we are working with government agencies to ensure the employees' issues are dealt with as best as possible."

The £35m-turnover company has experienced significant losses in recent years. However, it had witnessed an improvement in trading over the last year.

It is understood the company explored several opportunities to sell the business, but were unsuccessful.

Curtis Fine Papers managing director Keith Chapman was unable to comment at this time.

The company specialises in the manufacture and supply of quality uncoated fine paper for the UK and international markets.