End of the line for Northumberland Foods?

By Ben Bouckley

- Last updated on GMT

Related tags: Longbenton foods, Money

Offers in the region of £400,000 are invited for the Northumberland Foods' site
Offers in the region of £400,000 are invited for the Northumberland Foods' site
Food production looks unlikely to restart at the former Northumberland Foods site in Amble, after it emerged that the firm’s assets are being auctioned off and the site sold.

Administrator Johnnie Abraham from Begbies Traynor told FoodManufacture.co.uk that his firm had sold the site assets to Dutch-based auctioneer Troostwijk, but refused to discuss why it had not proved possible to achieve a sale as a going concern.

The site’s doors closed late last year, after Newcastle-based Longbenton Foods (which itself entered administration in March​), was unable to meet successive payment deadlines after paying an initial deposit to Begbies, which subsequently rescinded the sale contract and locked the factory doors.

Site sale

Property consultant Sanderson Weatherall is also marketing the factory site itself (on the Coquet Enterprise Site) for sale, with offers ‘in the region of’ £400,000 invited.

The auctioneer has set a June 28 deadline for offers for the firm’s assets at the “par-cooked frozen potato processing plant”​, which include potato roast lines, mashed potato lines, filling/packaging lines and spiral freezers.

Asked what the prospects were for finding a buyer for the equipment and other assets, with a view to restarting production, Troostwijk’s UK representative James Hague said: “It’s unlikely, but yes – it has happened a few times in the past. It’s an outside possibility because all the equipment is still there and is available.

“The object of the administrator was to find a buyer as a going concern in some sort of hived-down form. They obviously failed with that. But we’d have no objection if someone bought everything because we’d obviously get paid more.”

Administrator's outrage

To some extent, the ‘in administration’ tag – was simply a matter of nomenclature in such cases, Hague said, although he emphasised that Northumberland Foods still exists as a registered company.

“We just bought the machinery,”​ he said, adding that in such cases, the administrator (here Begbies Traynor) was still managing assets such as the company name, its real estate assets and order book, as well as dealing with debtors and creditors.

Local controversy arose when it emerged that Amble staff were owed money by Longbenton Foods when the firm entered administration in March.

About 70 workers hired by Longbenton were given a verbal agreement by the firm that they would be paid for days when they were sent home when production stopped shortly before Christmas, and for bank charges as a result of late wage payments, but had not received monies as of March.

However, a spokeswoman for Berwick upon Tweed MP Sir Alan Beith said that staff at Amble had now been paid most of what Longbenton Foods owed them: “I know that Longbenton Foods’ administrator Joe McLean ​[based at Grant Thornton's Leeds office] was pretty outraged about the way that employees had been treated, so most, if not all of the claims were settled pretty quickly.”

Related topics: Fresh produce

Related news

Show more

1 comment

Cash shortages at food manufacturers

Posted by Alan Jolly,

The Longbenton/Northumberland Foods failures are just symptomatic of what is happening across the British food industry. On the one hand the major supermarket chains keep up their pressure on prices to suppliers. Conversely, the banks are reluctant to extend credit to smaller companies for fear of failures. Somewhere the Government (Vince Cable?) has to realise that no action or assistance means more failures and more job losses.

Report abuse

Follow us

Products

View more

Webinars