According to BBC Sport, the three-year, £7.5 million deal was signed with the Sussex-based company in February 2007, but only one year of the contract has been paid so far.
In a statement to the press, West Ham said: “XL Holidays remains the club's principal partner and we await further information from the administrator before ascertaining the impact of these events. We are of course saddened for the customers of XL Holidays that they have been affected and hope that a speedy and satisfactory solution is found."
West Ham will now start the search for another shirt sponsor and wait, along with XL's other creditors, to see what administrator does with the company. A contingency plan had been built into the deal in the event of the club being relegated, with the annual payment being reduced from £2.5 million if the club did drop down a division.
XL Leisure Group is Britain's third largest package holiday group.
