Administrators strike deals to give stricken Sheffield steel firm breathing space
Administrators of a Sheffield steel manufacturing firm say they have struck deals with key customers which safeguard it until mid-December, preserving 110 jobs.
Kiveton Park Steel, which employed 120, now has enough cash to continue trading while it is marketed for sale, they say.
Joint administrators FRP Advisory say they are in talks with interested third parties.
The business suffered “unsustainable pressure” on cash flow due to a “sharp deterioration” in the specialist steel market.
Phil Pierce and Ben Woolrych, partners of FRP Advisory, were appointed at the end of September.
They say they do not expect to have to make further redundancies ‘while the support of key customer supply agreements remain in place’.
Phil Pierce added: “We are pleased we have secured commitment from some of Kiveton Park’s key customers for the next couple of months whilst we continue with the marketing process for business.
“We are grateful for the support of the business’ loyal, hard-working and skilled work-force during this period. The latest supply agreement helps underpin the funding needed to allow the business to continue to trade and service Kiveton Park’s customers. The joint administrators will continue to engage with interested parties whilst constantly reviewing the financial position of the business.”
Founded in 1922 and in continuous family ownership, the company, manufactures bright engineering steel bar and wire for products in the automotive, aircraft, cold forming and machined parts industries.
Despite exploring “a number of options”, including a solvent restructuring of the business, which was prevented “due to its severe cash-flow pressures”, directors were left with no option but to place the company into administration, FRP said.
At the time, Mr Pierce said: “The steel business continues to go through some tough times and it is unfortunate a Yorkshire-based business with nearly 100 years of trading should be the latest to feel the squeeze.
“As joint administrators we will be focusing on delivering Kiveton Park’s existing customer orders where possible, whilst constantly reviewing the financial position with a view to establishing a long term solution for the business in the interests of all the creditors.”
Kiveton Park Steel is based on Dog Kennels Lane.
It won a Queen’s Award for International Trade in 2012 and Export Development Award in the EEF Business Awards the following year.