Tyne & Wear

Northumberland frozen food company axes 250 jobs

Northumberland Foods, Amble
Image caption Northumberland Food's clients included Tesco, Sainsbury's and Iceland

A frozen food factory has closed in Northumberland with the loss of 250 jobs.

Administrators were called in to Northumberland Foods Limited, based in Amble near Morpeth, on Wednesday.

A spokesperson for the administrators said the firm was "loss making and facing cash flow problems" despite a £20m turnover last year.

A deal with a potential buyer, expected to rescue the company, failed at the last moment.

The joint administrator said: "Though the company was loss making and facing cash flow problems, we have been working hard to secure a sale to an interested party which would have rescued the company and saved the entire workforce.

"Unfortunately, despite the hard work and commitment of all concerned, this has not proved possible with negotiations failing at the 11th hour.

"Given the lack of interested parties and the company's substantial funding requirement in order to continue trading, we have been left with no alternative but for the company to cease trading immediately."

Council loans

Representatives from JobCentre Plus were on site on Friday to offer advice to employees.

Nearly 200 jobs were saved at the food factory after a £1.5m funding package was agreed in July last year.

Northumberland County Council provided a £250,000 secured loan. The council is expected to issue a statement later.

The Royal Bank of Scotland loaned £960,000 and regional development agency One North East, £250,000 to support the business.

Northumberland Foods took over the assets of the former Cheviot Foods from the administrator and started operating in January, 2009.

The company manufactured frozen potato products. Its clients included Tesco, Sainsbury's and Iceland.

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