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Rowecord Engineering, Newport: 430 jobs lost, say administrators | |
(about 4 hours later) | |
Some 430 people will lose their jobs after the collapse of Wales' biggest steel contractor, administrators have confirmed. | |
About 80 people will be kept on at Newport-based Rowecord Engineering, which built the roof of the Olympic aquatic centre. | |
The company said it had "exhausted every option" to try to carry on. | The company said it had "exhausted every option" to try to carry on. |
There are fears other companies along the M4 corridor which supplied Rowecord could also be affected. | |
Alistair Wardell, from administrators Grant Thornton, blamed the collapse on the company losing money on contracts and the general economic climate, which had led to future contracts drying up. | |
A contract to build the new blast furnace at Tata's Port Talbot steelworks had overrun by more than three months which had caused difficulties, he said. | |
Mr Wardell told BBC Radio Wales the issue had led to a dispute with Tata but he could not say for certain whether the business would have survived otherwise. | |
"I think certainly, in the short term, that amount of cash that was not available to it has partially precipitated the collapse of the business," he said. | |
"We are taking about a large amount of money. | |
"What I can't comment on is... ultimately whether this was a viable business or not. That is a very separate question." | |
In an earlier statement, Mr Wardell said the collapse of the company was also likely to have an impact on other firms along the M4 corridor which were its suppliers. | |
Vital partner | |
A spokesman for Tata Steel said the company had settled the issue about the overrunning of work on the blast furnace a month ago. | |
He described Rowecord Engineering as a vital partner. | |
"We have met all our commercial obligations," he said. | |
"We have offered them future work. It will cost us to replace them." | |
Earlier it was revealed that Rowecord turned down an offer of help from the Welsh government before it collapsed. | |
The Olympics aquatic centre roof was among its many high profile projects. | The Olympics aquatic centre roof was among its many high profile projects. |
The Welsh government said it offered assistance to the maximum level allowable within state aid rules but Rowecord turned down the offer. | The Welsh government said it offered assistance to the maximum level allowable within state aid rules but Rowecord turned down the offer. |
Until recently the company employed over 500 staff at sites in Newport, Baglan, and the Tata Steelworks at Port Talbot - but 100 of those were given notice over recent months. | Until recently the company employed over 500 staff at sites in Newport, Baglan, and the Tata Steelworks at Port Talbot - but 100 of those were given notice over recent months. |
In a statement on Friday the company said it had "exhausted every option to sustain the business in future" and would go into administration. | In a statement on Friday the company said it had "exhausted every option to sustain the business in future" and would go into administration. |
Tory business spokesman Nick Ramsay said he accepts that help was offered but told BBC Radio Wales it came too late in the day. | Tory business spokesman Nick Ramsay said he accepts that help was offered but told BBC Radio Wales it came too late in the day. |
"You've got to face the fact there are these drop-offs in ordering linked to the recession," he said. | "You've got to face the fact there are these drop-offs in ordering linked to the recession," he said. |
"Although the Welsh government did offer support I think that was later in the day than it might have been. | "Although the Welsh government did offer support I think that was later in the day than it might have been. |
"I think what we really need to see from the Welsh government is a better manufacturing strategy, for the government to stand back and say 'right, how are we going to better support companies like this?' | "I think what we really need to see from the Welsh government is a better manufacturing strategy, for the government to stand back and say 'right, how are we going to better support companies like this?' |
Rowecord has been a steelwork contractor on major projects, including: | Rowecord has been a steelwork contractor on major projects, including: |
Ron Jones, a Labour councillor in Newport's Pill ward, which covers Rowecord, described the news as a "major blow". | |
He added: "It's devastating to us actually because as an area of high unemployment, in excess of 20%, and this is adding to all that misery. | He added: "It's devastating to us actually because as an area of high unemployment, in excess of 20%, and this is adding to all that misery. |
"They have been here since 1970. They are a major company in Newport and when a major company goes to the wall you're in deep trouble." | "They have been here since 1970. They are a major company in Newport and when a major company goes to the wall you're in deep trouble." |