The company, the Co Derry town’s biggest employer, carried out work for companies such as BT and NIE laying cables and pipes.
The company operates out of a number of depots throughout the region, installing and maintaining water and sewage, electricity, telecoms and public lighting facilities.
The firm was established in 1994 by Kevin Lynch who said the company had been in discussions “for some time” with its lender in order to “restructure” the company to protect its “core contracting business.”
He added: “Despite a restructure of the company’s property debt before Christmas acute cashflow pressure has persisted.
“It is therefore with much regret that we have today sought the protection of administration.”
Joint administrator Stephen Cave, from PwC, said the priority would be to determine the company’s precise financial position and assess future options.
Sinn Fein MLA for the area Cathal Ó hOisín described the news as a “devastating blow” which he feared Dungiven “could not take.”
He added: “The effects will be catastrophic and I fear what is going to happen after this,”