THE future of an award-winning engineering firm has been thrown into doubt after the sudden collapse of a rescue deal.
Bosses at the Fin Machine Company, in Seaham, are now in talks over a proposed management buy-out in a bid to save the company, which employs 115 staff.
The precision engineering company, which has reported cashflow problems, looked to have been saved when it was bought from administration by US investors shortly before Christmas.
However, it has now been returned to administrators after an affiliate of the American Industrial Acquisition Corporation decided to pull out of its planned investment. Chief executive David Jennings, who is now spearheading efforts to safeguard the company, said: “The announcement from the US came as a bolt from the blue.”
The management team is now working with administrator Edwin Kirker of Kirker & Co and hopes to agree a deal in the coming weeks.
If the bid fails, Mr Jennings admitted that the prospects for the company were “very poor”.
However, he was optimistic that it had a “genuine chance of success”.
Fin Machine, which is based on Seaham Grange Industrial Estate, was launched in the 1980s and designs and produces machinery and tools used to make components for the air conditioning and car industry. It won the Queen’s Award for Export in 1997.
It went up for sale in September after funding problems hampered its ability to fulfil customer orders.
The firm continued to trade while a buyer was sought, but about 50 staff lost their jobs.
The American Industrial Acquisition Corporation has not explained its decision to walk away from the cut-price sale, although it is thought to have come about after it became fully aware of the additional investment required to develop Fin Machine.