Holiday park operator Pontin's has been placed into administration after being badly hit by the economic downturn.

The company, which operates five parks in the UK, has failed to benefit from the "staycation" trend, despite bullish reports earlier this year that it had experienced an increase in bookings for 2010.

In January, the company claimed to have seen a 22 per cent increase in summer bookings for 2010.

In September 2009 Pontin's announced that its holiday parks will undergo a multi-million pound refurbishment scheme over the next five years, with its Southport Holiday Park in Lancashire set to benefit from more than £100m alone.

Those plans are now in serious doubt as the day-to-day running of the operator has been taken over by KPMG.

In a statement, the company said that it will look to honour all existing bookings.

The statement read: "Following the announcement that Pontin's had been placed in administration, KPMG the appointed administrators, have underlined the commitment they and the Banks have to ensure that the company continues to operate as normal whilst they seek a new owner.

"Guests who have bookings for the future are assured that the business will continue to trade and their holiday will not be affected. There is, therefore, no reason to cancel and there will not be any refunds if anyone wishes to do so."

Pontin's was taken over by private investment firm Ocean Parcs in 2008.