Hundreds of jobs to go as paper maker closes doors
HUNDREDS of workers were made redundant yesterday after a major paper manufacturer went into administration.
Tullis Russell Papermakers called in administrators after losing £18.5million over the past five years.
The firm, which has been based in Markinch, Fife, for more than 200 years, employed 474 workers.
But the administrators immediately made 325 redundant, with the remaining 149 kept on to complete some orders.
The company sold 126,000 tons of paper and board last year, but suffered a pretax loss of £3.4million. Steps began last year to find a buyer for the business, but they proved unsuccessful.
Joint administrators Blair Nimmo and Tony Friar of KPMG concluded there was no option but to reduce the workforce. Mr Nimmo said yesterday: ‘This is a sad day for the employees of Tullis Russell, who have worked hard against the significant headwinds facing the papermaking sector.’
Employee- owned Tullis Russell was founded in 1809 and produced high quality paper board for use in cards, book covers and packaging. But it has seen European exports suffer and has also
‘This is a sad day for the employees’
been hit by rising raw material costs and a major customer becoming insolvent.
Mr Nimmo said: ‘Whilst we will be exploring whether a sale of all or part of the business and assets of the company can be achieved, we have had to take steps to significantly reduce the company’s overheads.
‘Unfortunately, with trading effectively ceasing, we have had no option but to reduce the size of the workforce. We will be working with government agencies to minimise the impact on employees. We would encourage any party with an interest in acquiring all, or parts, of the business to make contact with us as soon as possible.’
Tullis Russell Papermakers is a wholly owned subsidiary of Tullis Russell Group.
Group chief executive Chris Parr said: ‘This is a terribly sad day for employees and their families, the local community and everyone else associated with the business.
‘Since the recession, demand across the traditional market for papermakers’ products has fallen by 40 per cent; our primary raw material, wood pulp, is trading at consistently higher price levels than ever; and exchange rates have moved against the business.’
He added: ‘The group engaged KPMG to run a comprehensive sales process. This has only confirmed the business is no longer viable.
‘The directors of our papermaking business were therefore faced with no other option than to place the business into administration.’
Constituency MSP Tricia Marwick said: ‘This is a tragic day for Markinch and Glenrothes and for 474 people likely to lose their jobs if a buyer cannot be found. I am devastated by the news.
‘I will be seeking an urgent meeting with ministers and Fife Council to discuss what support can be given to the workers and what support can be given to help the town and the immediate area recover.
‘The news today could not have come at a worse time, following the recent loss of jobs at Velux in Glenrothes.’
First Minister Nicola Sturgeon announced a taskforce to support the area affected by the job losses.
The Joint Taskforce for Fife will be chaired by the Scottish Government and Fife Council, with Deputy First Minister John Swinney leading for Scottish ministers.
Miss Sturgeon said: ‘I am very concerned to learn of the job l osses at Tullis Russell in Markinch. This will be a deeply anxious time for the workers, their families and the local community.
‘The taskforce will work with the administrators to try to secure an alternative owner and it will look for ways to help mitigate the effects of j ob losses by putting in place support for workers to help them back into jobs and training.
‘I know people in Markinch and across Central Fife will be worried tonight. I would like to assure them the Scottish Government stands ready to help in any way we can – and that is exactly what we will do.’