More jobs under threat after 15 immediate redundancies

9:51am Tuesday 16th March 2010

By Deborah Johnson

ABOUT 80 jobs were last night under threat, and 15 people were immediately made redundant after a Teesside industrial fabrication business went into administration.

Amidst growing losses during the recession and a vast decline in new work, Hertel Project Services (HPS), based at Wilton, near Redcar, was last night said to be “no longer sustainable in its current form”.

Fifteen redundancies were made by administrator Vantis yesterday, with the remaining 80 employees told they will keep their jobs until HPS completes work in progress, which is believed to be for several more weeks.

The future for the company – which works primarily in the nuclear, process, petrochemical and pharmaceutical sectors – beyond that time was last night uncertain, with administrators only saying they would continue to keep the situation under review.

And its decision to call in administrators came as another blow to the Wilton site, which in the last few months has seen the closures of the Invista, Dow and Croda sites, and the administration and mothballing of Artenius, which has since reopened under new ownership.

HPS was part of the business bought by Middlesbrough- based industrial services company Hertel UK from Aker Kvaerner Engineering Services in 2006. The move safeguarded 160 jobs, including 100 in the fabrication business.

Significant investment has been made by Hertel since that time, in an attempt to stem losses in the fabrication division, which culminated in the split of the valve maintenance and fabrication divisions in May last year, leading to the formation of HPS in the hope the independent business would sustain itself.

David Fitzsimons, director of HPS, said last night: “It is extremely regrettable that we have had to take the decision to place HPS into administration.

“We had anticipated that, operating as a standalone business, HPS would have the freedom to seek new work and customers.

“However, given the current tough business environment, this has been extremely difficult and the volume of work required in keeping the workshop busy has not been available.

A spokesman for Hertel added that the rest of the group is unaffected by the administration of HPS.

Vantis Business Recovery Services, a division of Vantis, last night confirmed it is handling the administration of HPS, and that David Thornhill and David Broadbent have been appointed as joint administrators.