KITCHEN worktops company Vertex could be about to change hands again.

The Shildon business, which was brought out of administration in December by a management buyout (MBO) team led by managing director Joe Martoccia, is in negotiations with an as yet unnamed leading European chipboard supplier.

The deal, which is believed to be at an advanced stage, would secure the remaining 120 jobs at the plant.

The company is blaming the present tough economic climate for cuts in its staff levels.

So far this year it has laid off about 40 agency staff and 20 full-time employees.

Last week, Transco cut off gas supplies to the business in a wrangle over the supply contract.

Mr Martoccia said: "Gas supplies to the Vertex plants at Shildon have been cut off.

"We had been trying to negotiate over the supply of gas to our business since the management buy-out was completed, but unfortunately we have been unable to get the supply contract transferred to the new owners.

"However, we are still managing to operate by running our turbines on diesel fuel."

He added: "Our backers, ING Lease, who helped to finance the MBO, have been very sympathetic to our plight and are currently putting a package together to maintain the business."

Mr Martoccia confirmed that the company had started paying its staff by weekly cheque, rather than through a bank, but denied claims that some of the cheques had bounced.

He said: "We have been forced to pay our staff by cheque, due to changes in banking regulations since the terrorist attacks on the US.

"However, claims that the cheques have been bouncing are completely unfounded. It is a very difficult time to be in business in the UK, with manufacturing of any kind under increasing pressure.

"We are continuing to fight to secure the future of this business and its 120 workers.

"We are at an advanced stage of negotiations with a European trade partner that would maintain the future of Vertex and it workforce."

Vertex, which was originally based in Bolton, Greater Manchester, bought the former George Reynolds UK business last February.

The businessman decided to sell the company to concentrate on Darlington Football Club.

When Vertext experienced financial difficulties, administrators Begbies Traynor were called in to negotiate its sale to the buyout team