Around 200 jobs have been saved at North East manufacturer AEI Cables after the business was acquired by a major Middle East-based company.
The Birtley business, which has 175 years of cable-making experience, faced falling into administration in 2011 but has been kept afloat through a Company Voluntary Arrangement (CVA).
Difficult trading conditions meant the firm had to ask creditors to accept a more manageable debt repayment schedule last August, but the firm’s fortunes have since turned a corner, with annual accounts for the business revealing a strong order book – £10.7m for the year ended March 2013 compared to £6.7m for the year before.
Now the company – one of the oldest of its kind in the world – has been given a huge shot in the arm after being bought out by part of the Ducab organisation, providing it with new resource and access to new markets.
Under the terms of the agreement, AEI Cables will become part of the Ducab organisation and will continue to manufacture cables from Birtley, trading as AEI Cables Limited.
The focus of the company will continue to be the manufacture of cables for the industrial sector including defence, construction, rail and oil and gas with particular emphasis on fire performance products.
Ducab, based in the Middle East with six manufacturing facilities in Dubai and Abu Dhabi, supplies a wide range of power cables and accessories to customers in more than 40 countries worldwide.
Clive Sharp, chief executive officer of AEI Cables, said: “This is very positive news for our employees and our customers. Ducab is a world leader in cable manufacturing and brings a wealth of experience, expertise and technical support to give us additional resource.
“Joining Ducab offers new opportunities in terms of the products and markets we can serve and gives us further advantage over our competitors.
“This presents an exciting future for us, and it brings renewed job security for our employees – and that is good news for their families and the local community.
“I am proud of our progress through some difficult times and this news is testament to the hard work that has been brought to bear in support of AEI Cables by everyone in the recent past.”
Andrew Shaw, managing director of Ducab, said: “AEI Cables has an unrivalled reputation for product quality and the strengths of its team and its employees are a great asset. It is these qualities we want to harness and grow as we progress.
“We believe that this heritage, combined with technical expertise in the development of products and services, can help to place the combined company at the forefront of cable development for many years to come.”
Transaction services partner Chris Stott and associate director Andrew Lancaster from KPMG’s Newcastle office advised Ducab on the transaction.
Lancaster said: “Protecting over 200 jobs at AEI Cables is great news for the economy in County Durham and is testament to the hard work from the local advisory community to get the deal completed in such a short time frame.
Ducab is a world leader in its field and, with its backing, AEI Cables can build on its legacy and look forward to a secure future.”