THE administration of an historic paper company has been described as "immensely troubling" for Scottish manufacturing.
Arjowiggins Group UK subsidiaries, which owns and operates two mills in the UK, in Stoneywood, Aberdeen, and Chartham, Kent, appointed administrators on Thursday evening.
The group’s UK operations were established in 2019 through a management buy-out following the insolvency of French parent companies, Arjowiggins and Sequana. However, its origins date back to 1738.
The administrators said that "skyrocketing energy costs and spiralling input prices, have proved to be overwhelming for the group".
The independent manufacturer that produces fine and custom papers including for graphic design, packaging and labelling, and security printing has battled difficult trading environments since Covid-19 on trading and cashflow leading it to losses "exacerbated in more recent times by the significant increases in energy costs and the price of raw materials, including pulp".
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Directors of the group "worked extensively, exploring all options to safeguard the future of the business, but with a solvent solution unable to be secured, took the difficult decision to place the group’s UK companies into administration".
The administrators made 368 of the group’s 463 UK-based employees redundant immediately following their appointment. Some 95 members of staff have been retained "to assist them with the operation of limited activity across the two sites as "any possibility of a sale of the sites and assets" is explored.
Blair Nimmo and Alistair McAlinden, of Interpath Advisory, were appointed joint administrators to 10 Arjowiggins Group UK subsidiaries.
Mr Nimmo said: "Arjowiggins has a long and proud history dating back more than 260 years, so this is immensely troubling news for UK and Scottish manufacturing."
Mr McAlinden said: "Over the coming days and weeks, we will be exploring options to achieve the sale of the sites and assets and would ask that potential interested parties contact us as a matter of urgency."
The group also owns and operates mills in Spain and China via its Guarro Casas and ArjoWiggins Quzhou subsidiaries. Neither operating company is subject to insolvency proceedings.
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