The writing was on the wall last Tuesday when the Quinn Group appointed Talbot Hughes McKillop to provide financial restructuring services to the company, with partner Murdoch McKillop to run the group as interim executive director.

Quinn Group chief executive Liam McCaffrey dressed up the decision as a bid to "ensure that executive management are not excessively diverted from the vitally important job of running our manufacturing business". But in reality it was a surrender of executive power which signalled Sean Quinn, the main shareholder, was no longer fighting to win. Instead, he was making a desperate bid to salvage what he could of his crumbling empire.

"It certainly looked desperate," said one Dublin-based corporate finance expert. "What you get in situations like this is an owner realising too late that he is running out of time to save his personal wealth."

The impact was almost immediate. By Thursday afternoon the Quinn Group had dropped its opposition to the Financial Regulator's appointment of administrators to Quinn Insurance Limited (QIL), which the regulator argued had been in breach of its solvency requirements for nearly two years. Now QIL will be run by outside managers with a brief to restore the company to viability.

"It was important to stress that it is part of the stated function of the administrators to carry it on as a going concern with a view to placing it on a sound commercial footing," High Court Justice Nicholas Kearns said.

The judgment marked a significant victory for head of financial regulation Matthew Elderfield, who told an Oireachtas committee last week that there had been serious and persistent solvency breaches by Quinn Insurance and that its 1.3m policyholders had to be protected. By accepting the regulator's position, Quinn Group (and by implication Sean Quinn himself) had finally conceded that the insurance business was in need of emergency resuscitation.

It was a remarkable change of attitude. The day Elderfield first moved on Quinn in the High Court, the group shot back that his actions were "pre-emptive, aggressive and unnecessary". The loan guarantees on certain subsidiaries of QIL, which the regulator argued gave rise to a €448m liability, would not be called upon, the group said. The group also said it was generating "cash profits" of €20m per month, although it did not specify whether this was coming from the insurance company or other parts of the business.

The problem, of course, was that the group was loaded with debt ? €2.8bn to Anglo Irish Bank and €1.2bn to a group of bondholders led by Barclays which could be traced, ultimately, to Sean Quinn's disastrous investment losses in Anglo shares and other equities. Because of the guarantees, the debt threatened the insurance company's solvency. Anglo proposed filling the solvency hole and refinancing the non-Anglo debt in the group in a €700m takeover deal, but the regulator made clear it would block any merger between the ailing insurance company and the nationalised bank.

This left Quinn with little room to move. The group played its last card in court last Monday when it submitted a formal response to the regulator's affidavit, which delayed a final judgment on the adminisatration until tomorrow, but Quinn was unable to last that long.

With as much as €1.5m reportedly bleeding out of the company every day because of the closure of its UK business, which accounted for about half of its cashflow, there was only so long the group could hold out. To protect the rest of the group, which includes quarries, building materials, property and leisure interests among its diverse businesses, from the contagion of a disorderly contested wind-down it appears McKillop used his executive authority to agree to administration.

The question now is whether the administrators can turn the business around. The signs are not good, if the regulator's affidavit is anything to go by. Since May 2008 Quinn has been submitting and revising financial recovery plans to the regulator, but failing to convince its supervisors that it could trade its way out of trouble. Deteriorating economic conditions affected the value of its assets, but its low-price competitive model left it short of the funds to make up the difference. In the UK, for instance, it incurred underwriting losses of €40m.

Regulatory officials told the Sunday Tribune that concerns about QIL extended beyond solvency numbers. They said the business model was flawed and corporate governance standards at the company were not up to par. They also said their case against the company had only become more compelling as the administrators uncovered information about the true state of the QIL business.

"We are more convinced than ever we need to investigate," said one senior official. "We are looking at solvency, the failure of systems and controls, and the actions of individuals."