ADMINISTRATORS for troubled manufacturer Lionweld Kennedy have confirmed a buyer has been found, saving nearly 180 jobs at the Teesside company.

However, a further 15 staff will lose their jobs as the contracting side of the business is wound up.

Lionweld, which went into administration four weeks ago, has been bought in a £2.6m deal by the Hill and Smith Group, based in Solihull, in the West Midlands.

The acquisition, which is thought to have been completed late last week, means that 178 workers at the company will keep their jobs.

Hill and Smith has bought more than 95 per cent of the business, but administrators Ernst and Young confirmed the West Midlands firm would not be purchasing the contracting division of the manufacturer.

Lionweld's contracting business, which is thought to have contributed to the firm's financial difficulties because of its fixed contracts with customers, saw 37 job losses following the appointment of administrators.

A spokeswoman for Ernst and Young said the remaining 15 contracting staff were being made redundant.

The spokeswoman said: "We went into negotiations with Hill and Smith just a few days after we were appointed, so this is a comparatively quick sale.

"Although the majority of the jobs have been secured, it has not been possible to save all of them."

She said Hill and Smith would be speaking to the staff in the contracting division about other job opportunities within the group.

Lionweld, which manufactures hand rails and steel floors and has sites in Middlesbrough and Hartlepool, last changed hands more than two years ago, when it was bought from Pacifica, an Australian company.

Managers at Lionweld at the time bought the business from Pacifica for £7.5m, nearly £5m more than the Hill and Smith deal.

David Grove, chief executive of Hill and Smith, which announced record profits of £5.3m in June, said: "The acquisition of the Lionweld operations will help the group to build on its core business areas where the markets are particularly strong.

"Apart from bringing extra capacity where we need it, the Lionweld business has a good name and an excellent customer base. It will provide added impetus to our growth."