Confirmation that Waterford's Red Kettle Theatre Company is to go into liquidation has been greeted with shock.

The news emerged yesterday that the company, which was founded nearly 30 years ago, was going into liquidation because of trading difficulties.

Red Kettle toured extensively throughout Ireland as well as performing in New York, London and Edinburgh. Lately it has been based at its own premises on Parade Quay in the city’s Viking Triangle.

Acting chairwoman of the theatre's board Frieda Ryan confirmed that the company had started the liquidation process. "It's obviously very regrettable," she said. Ms Ryan declined to comment further as the board was in discussions about whether to release a statement on the matter.

As with many other arts ventures, its funding declined in recent years. The Arts Council gave €226,000 to Red Kettle in 2008 and this was down to €145,595 by last year. The latter amount was to fund youth projects and a tour by the company's last major production.

One of the founder members of Red Kettle was Independent councillor Mary Roche who said news of the liquidation was "a shock" but shouldn't be allowed spell the end of the theatre company.

"Our motto was always to bring the theatre to the people of Waterford and it's a sad state of affairs that is no more," she said. She accused the Arts Council of favouring theatre companies and other cultural institutions in the bigger cities, when it comes to funding.

One of the first major works of the company, The Gods Are Angry Miss Kerr, featured Mary Roche and was written by Jim Nolan.