The region’s manufacturing sector was left reeling when Zentia – the UK’s only suspended ceiling plant – called in administrators after 101 years of trading.
Two Gateshead factories which closed their doors when their parent company collapsed into administration, resulting in the loss of 170 jobs, are poised to reopen after a multi-million pound deal. The region’s manufacturing sector was dealt a significant blow when Zentia – the UK’s only suspended ceiling plant – was appointed administrator at Interpath in June, ending 101 years of trading.
The company, a former North East Business Award winner, employs a large workforce across two Team Valley sites, producing suspended ceilings for customers across the UK. Within weeks, however, documents filed by the administrators stated that they were in negotiations with a potential buyer of the business.
Now, a multimillion-pound deal has secured a new future for both factories – raising hopes that a significant number of jobs can be created, including the re-hiring of former employees who were previously made redundant.
British law firm RFB Legal is advising Turkish ceiling maker Prosista on its acquisition of Zentia’s factories and manufacturing assets, following Zentia’s administration in June amid rising energy costs and falling sales.
If Prosista does not sign, the UK will lose its only suspended ceiling factory, ending decades of UK exports and leaving the country dependent on imports. The deal includes manufacturing space, machinery, stock and intellectual property, with Prosista already hiring former workers and outlining plans to create more than 100 jobs at the site.
At one of Zentia’s sites in Gateshead(Image: Zentia)
The transaction was completed within a demanding deadline, with Zentia’s administration requiring RFB Legal to coordinate negotiations with various parties while addressing issues related to the remaining properties and employees, Chronicle Live reports.
The deal was led by RFB Legal Senior Partner Deniz Oguzkanli and Corporate Partner John Andrews, with Employment Law Partners Adam Pavey, Samuel Glasgow, Jasmine Azaei and Gauri Dalvi also advising on the acquisition.
Mr. Oguzkanli said: “This is a welcome investment in British manufacturing and an opportunity to bring more projects back to Gateshead, and it is encouraging to see an international manufacturer recognize the potential of this facility and plan further investment in the area. Buying from the administrator is obviously dealing with several parties, all with different interests, while making sure that our clients are protected from the risk of being connected to the previous business.
“With so many different aspects to the deal, our team had to work together to make sure nothing was overlooked.
Prosista ranks among Turkey’s leading ceiling manufacturers, serving the domestic and overseas markets, with the takeover enabling the company to expand its product portfolio through Zentia’s established manufacturing site.
Mehmet Lacin, director at Prosista, said: “There is a great deal of history behind this factory, and we want to build on the manufacturing skills and experience developed in Gateshead over so many years instead of seeing them disappear. By combining our expertise in metal ceilings with mineral ceilings and acoustic products made in Gateshead, we can develop some new products while creating more opportunities for local workers and.”