ANGLO-Norwegian engineering firm Kvaerner, which employs about 1,500 staff on Teesside, needs to raise £20m in the next week.

The group, which employs 7,000 UK workers, has asked its banks for the funds to tide it over the rest of the month.

Kvaerner sold its research and development businesses to its largest shareholder, the Russian oil group Yukos, last month for £66m.

Just over half of the amount has been paid, but Kvaerner said it will have a cash flow problem until the balance is due on November 30.

A statement from the company said: "Until this takes place, the group will, as expected, see an unfunded need for cash."

Kvaerner is also in discussions with Yukos over a possible early payment of the balance.

The announcement comes as Kvaerner battles to stave off the growing threat of bankruptcy.

An extraordinary general meeting next Thursday will ask shareholders to vote on a rescue plan drawn up by Yukos, involving a share issue and debt restructuring.

If shareholders at the meeting vote in favour of the rights issue, they will be able to subscribe to the offer of new shares in the company between December 4 and 17.

However Norwegian oil services company, Aker Maritime, the second largest shareholder in Kvaerner, has urged shareholders to delay their decision until it puts forward its own rescue plans.