The workforce at woodworking machinery company Wadkin has been more than halved by receivers called in to rescue the ailing business last week.
Around 150 mainly shopfloor personnel from the 280-strong workforce were let go from the Leicester-based manufacturer last week by Ernst & Young, which is trading the company while a buyer is sought. At the time of the receivership it was thought that redundancies could be limited to around 60 (TTJ March 10), but additional lay offs were required to bring down the business’s cost base.
Receiver William Tacon said: ‘It was not a sustainable business in the short term, so we had to stabilise the situation. We could not just carry on as the business was beforehand because it wasn’t making any money.’
The company, which was bought by a management team in 1995, is now working on completing business in hand and is taking order enquiries. Ernst & Young hopes for a number of bidders for the £25m-turnover business, given its strength in moulder technology.
While many industry figures were taken by surprise by Wadkin’s crash, some said they had been expecting it. The business had been labouring under a £5m debt burden.
Rye Technology Ltd managing director Adam Kingdon said: ‘With the exception of the present MBO team who have been battling to save the business, Wadkin has moved from one poorly-managed conglomerate to another.’
Weinig UK managing director Malcolm Buchanan said: ‘Wadkin has been in trouble a couple of times before and each time it has been bought out. One or two companies have come to the rescue over the years. It doesn’t seem that this has been the case this time round.’
Some in the industry have expressed concern about the spares situation. Kevin Cubbage, director of the British Woodworking Federation, said most BWF members would have Wadkin machines in their factories.
‘I very much hope that somebody will buy the business because members will need to be able to call on spare parts as those machines are in widespread use.’
