A MULTI-MILLION pound deal to rescue Filtronic's Newton Aycliffe microchip plant could be tied up in the next few weeks.

The electronics company confirmed in the summer heads of agreement with American-based M/A-Com and BAe Systems Avionics to boost capacity at Newton Aycliffe.

Filtronic had been seeking a "white knight" to share the financial burden of running the plant, estimated at £1m a month.

Professor David Rhodes, Filtronic's executive chairman, announced yesterday that definitive agreements would be signed soon and contracts exchanged.

He said: "Progress has continued according to schedule and agreements will be completed within the next several weeks."

Newton Aycliffe, which produces parts for mobile phones and cellular base stations, employs about 100 staff. It is hoped that up to 30 jobs could be created over next year as a result of the agreements.

M/A-Com is engaged in worldwide mobile handset manufacture with customers including Nokia, while BAe Systems Avionics supplies defence applications.

Filtronic shares were up 4p to 175p on the back of the announcement made at the company's annual general meeting.

The meeting in Bradford heard that results for the first quarter of the financial year were satisfactory.

Prof Rhodes said: "The uncertainties which currently exist in the global economy create a difficult environment in which to look forward.

"Nevertheless, our forecasts indicate that trading will remain at least at current levels throughout the first half of the year."

Projections for an improved performance in the second half of the financial year remained unchanged.

Preliminary results announced in May by Filtronic revealed bigger than expected pre-tax losses of £21m across its operations.

Group sales grew by 34 per cent to £297.4m, largely on its core wireless infrastructure business