AFTER a shaky start to the year it was confirmed last week that the Boddam arm of Smith’s of Peterhead has been closed.
Administrators had hoped earlier in the year that the Buchan textile firm still had hope for survival, but most recently struggled to strike a deal with potential buyers that would include all aspects of the Buchan Braes-based company.
Smith’s of Peterhead was formally placed into administration after failing to reach an agreement with HM Customs to pay back unpaid taxes amounting to nearly £120,000 in February this year.
Owner Marian Shildrick had hoped to negotiate a deal with HMRC, but joint administrators Ken Pattullo and Paul Dounsis of insolvency specialists Begbies Traynor were appointed in a bid to keep the Buchan Braes-based company afloat.
The closure of the Boddam outfit has resulted in the loss of around 20 skilled textile jobs.
However, last week the two announced the sale of the non-property assets and goodwill of the spinning business of Smiths of Peterhead Ltd which operates from Mintlaw in a deal which will eventually recover over £400,000 for creditors of the firm.
The deal was made with Christian Rodland, owner of Touch Interactive Ltd and son of Smith’s of Peterhead’s former owner Marion Shildrick. Mr Rodland will operate the spinning business of Smiths of Peterhead from the firm’s Mintlaw factory.
Joint administrator Paul Dounis said: “Despite negotiation with several potential buyers, no offer was received that allowed us to sell the entire business retaining both factories and save all the jobs.
“With intense pressure on us to cease trading at Smiths altogether, and no reserves of cash to continue to pay wages, regrettably we had no choice but to close the Boddam factory with the very sad loss of 20 jobs.
“Regrettably this was the best outcome possible under the circumstances, and we hope the firm can re-establish its former success from new foundations, and grow from this reduced base.”
The 190-year-old firm that was based at Kirkburn Mills since 1850 is one of the country’s leading manufacturers of woollen fabrics and knitwear yarns.
It supplies leading fashion houses throughout Europe and the rest of the world including brands such as Gucci, Prada and Ralph Lauren.
Mr Dounis added: “It is often the case that the best, or even only offer comes from an employee or former director of a business as they have the expertise, knowledge and confidence in the future of a business to fund a purchase. Mr Rodland’s knowledge of the Smiths of Peterhead, and the continuity that his involvement affords the new business will be invaluable in helping it to recover and grow again.”