CHEMICAL company Artenius went into administration owing millions of pounds to a neighbouring Teesside business and faced a lawsuit for non-payment, it was revealed last night.

The Northern Echo has learnt that Artenius owed fellow Wilton-based chemical company Sabic between £8m and £10m when it was put into administration by its debtladen parent company La Seda De Barcelona, on Monday.

And it was also revealed that Sabic was taking legal action against Artenius at the time of administrator Deloitte being called in, and comes after managers at Artenius told The Northern Echo last week the plant was not receiving sufficient funds from La Seda De Barcelona to sustain it.

However, the action by Sabic, which came after numerous attempts to retrieve the money amicably, is now expected to be withdrawn in light of the administration of Artenius, which came after La Seda De Barcelona’s £564m group loss last year saw them look to restructure the business.

Earlier in the week, 137 people were made redundant – more than half of its 242- strong workforce – at Artenius’s T8 plant, which has been offline since March. The jobs of the remaining workers remain at risk, and a buyer for the business is now being sought.

Last night, Sabic confirmed the debt and that it had filed a High Court petition against the company, but said it now expected such action to be dropped.

A spokesman said: “We have made repeated attempts to achieve an amicable solution for the recovery of that money without success.

“In an effort to protect our business interests, Sabic Europe in Holland commenced legal proceedings against La Seda De Barcelona and Artenius to recover the outstanding debts.

“However, shortly after starting this legal process we were informed that Artenius had decided to file for administration.

We now expect our case to be stood down or withdrawn by the courts.”

Any further decisions, such as becoming a creditor, would depend on what happened with the administration process, the Sabic spokesman added.

Anger has mounted since Monday’s move by La Seda De Barcelona to put its Artenius division into administration, with unions accusing the Spanish-owned company of “cutting the North-East and its workers adrift”.

The Wilton site has traditionally been a profitable business, with demand for its plastic products – which are used in food and drink packaging – remaining strong despite the economic downturn.