Hundreds of Paperlinx staff have been made redundant after administrators took in and have shut down a large section of their UK operation.
Newly appointed administrators Matt Smith and Neville Kahn are now joint administrators of the UK business Paperlinx. The Paperlinx company had roughly 1,200 employees, just over half of these are now job-less, 693 people to be precise are now made redundant, after the announcement that 14 of their sites are to be shut down and only five sites will remain open.
The packaging businesses, Parkside Packaging, 1st Class Packaging and Donnington Packaging supplies will not be affect by the administration.
A statement given by Matt Smith one of the new administrators had this to say “The administration appointment specifically relates to Paperlinx UK’s paper and visual technology solutions businesses. The industry has faced an increasingly challenging environment due to falling demand as digital communications have increased. We are investigating how best to maximise value in the businesses for the benefit its creditors.”
This news is set to have major impact on the United Kingdom printing industry as Paperlinx were the country’s biggest merchanting group. Matt Smith did said that the business would continue to trade but “on a limited basis”
The company Deloitte are now interested in looking for a buyer, for part or all of the business, this would include their packaging operations.
The shares in Paperlinx UK have been suspended since late March because of the cash crisis in European operation, this is because of the possible breach of banking covenants with its European financers.
The Paperlinx Ireland has not been affected by this and neither has Europe, Asia and Australasia