Optimistic Entertainment has gone into administration citing adverse media coverage of the participation TV sector for the drop in profits.
The decision to fold the company follows several efforts to refinance and restructure.
A statement from the company said the Optimistic board had had discussions with many potential investors and purchasers over the last few months but "after undertaking due diligence none of these was able to support a restructuring of the Group."
It goes on to say that adverse media coverage of the participation TV sector as a whole together with regulatory investigations have significantly impacted on consumer confidence and audience participation for its shows.
As a result Optimistic Media, the TV and radio production arm of the business, which produced an operating profit in the first quarter of the year, has moved back into loss.
Earlier this month the companies TV channel and distribution business The Optimistic Network sold its classic comedy movie and drama satellite channel Bonanza TV for just £1 to Caparo Ventures and Film 24.
In May the companies Life Two airtime was sold to Life TV Media for £270,000.
The administrators of The Optimistic Network and Optimistic Media have agreed to sell the assets of each of the businesses to Fluorescent Media, a company in which Optimistic's chairman and chief executive Jasper Smith has an interest.
The sale will save the jobs of employees within the trading businesses.