A MANAGEMENT buyout could save more than 200 jobs at a troubled engineering firm.

Eliza Tinsley's metal fabrication factory at Evenwood, near Bishop Auckland, is believed to be the subject of a management buyout - which could save the plant after its parent company was plunged into administration last month.

Administrators confirmed there had been interest in the business, but would not confirm who had put bids in.

But two directors of the company are believed to have told the Evenwood workforce they had put a bid in for a management buy-out of the plant.

And The Northern Echo understands that two other companies are interested in bidding.

The Midlands-based Eliza Tinsley Group, which makes DIY hardware, appointed administrators from Ernst and Young at the end of January, and ceased trading on the stock exchange as it went into a round of crisis talks with bankers.

Last night, a spokeswoman for Ernst & Young said that the business was still trading as a going concern and there were no immediate plans for job losses.

She said administrators were optimistic about finding a buyer, but said that it was too early to comment on any potential purchasers of the Evenwood site, which is just one of several factories within the group.

She added: "We are progressing interest in the business and other associated businesses within Eliza Tinsley."

The Tinsley group made 62 redundancies at its Evenwood site, formerly Evenwood Engineering, before Christmas, blaming a downturn in the industry and pressure from the Far East.

However, unions said that some of the workers who lost their jobs were still waiting for their redundancy money when Tinsley went into administration and will now have to apply to the Government to get it.

One worker, who did not want to be named, said: "There's still a lot of uncertainty among staff.

"Although there are bids in for the business, we're concerned that whoever buys the factory will make further redundancies to cut costs as much as possible."

The GMB union said the company's 219 employees were "absolutely devastated" when administrators were appointed.

The former Evenwood Engineering plant, which is more than 50 years old was taken over by the Tinsley Group in 1996.

Any redundancies at the factory would have a knock-on effect on the communities of Evenwood and West Auckland, which rely on a handful of companies for employment.