ELECTRICAL engineering company Watson Norie is to close by the end of the year, with the redundancies of the 49 staff still remaining from the former 543-strong workforce.
The firm, based in Walker, Newcastle, has been trading for 88 years but has been unable to survive in the current economic turmoil.
Administrators Ian Green and Mark Loftus of PricewaterhouseCoopers had been trying to find a buyer for the firm since they took control of it on September 25, but have now formally abandoned those efforts after terms could not be agreed with any bidder.
The company's recent problems are said to stem from delays in payment by one of its principle customers for two major contracts worth a total of £9m.
But company accounts show Watson Norie has been facing difficulties for some time, with its profits nose-diving from £783,000 in 2003 to just £79,000 in 2007, despite its turnover hovering above £28m over the period.
The firm is said to have been in rescue talks with the Middlesbrough office of Dutch engineering firm Hertel before announcing its administration, only for the Teesside outfit to pull out before a deal had been struck. There was also speculation from the Unite union about construction giant Balfour Beatty being interested in the company, but no deal has emerged.
A spokeswoman for PwC said: “There are now just five staff left at the Newcastle site. On PwC’s appointment, the group had 543 members of staff at various different sites and 494 were made redundant then.
“There is no prospect of a sale of the Newcastle site and we are engaged in a controlled wind down. The remaining people are to be made redundant on December 31.”
It is understood there are now only 49 people left in the company as a whole, with the majority of those at Scunthorpe in Lincolnshire and Grangemouth near Edinburgh.
Some of those are being transferred to work for Watson Norie’s former clients, including Corus at Scunthorpe.
Kevin Rowan, regional secretary of the TUC, said: “It’s very bad news for the region and a significant milestone in terms of the current economic outlook in the region.
“It was not unexpected. We know there have been problems, and quite severe pressures in the economy. It's important agencies do what they can to mitigate against the short and long-term impacts.
“They contribute well to the region but suffered the same pressures as all other companies in the region.”