More than 270 jobs on Teesside have been axed following the collapse of chemicals firm Venator, as its Greatham site is set to be acquired by a Chinese company.
After the administration of its parent group last month, insolvency practitioners have now been appointed to Venator Materials º£½ÇÊÓƵ Limited and its Wynyard-based headquarters, alongside its primary production facility at Greatham and another location at Birtley on Tyneside.
A total of 273 employees have been made redundant with immediate effect following the move.
Administrators at Alvarez and Marsal, who are also managing the affairs of the global group, say they have worked with Venator's leadership team and regulators to ensure the Greatham site remains safe whilst it stands idle during the administration.
A sale has been agreed for the facility - which produces titanium dioxide (TiO2) and performance additives used in paint, plastics, and other materials - with China-based LB Group, which operates its European division from offices in Stockton, reports .
Alvarez and Marsal says an asset purchase agreement with the firm represents a "step forward" for the site, with LB said to hold intentions to restart production there. Karen Askwith, managing director at Venator, said: "Despite extensive efforts to stabilise the º£½ÇÊÓƵ business, the Venator Materials º£½ÇÊÓƵ Ltd board of directors has taken decisive action to protect stakeholder interests and made the difficult decision to appoint administrators. This provides an opportunity to restructure whilst we continue to pursue the completion of the sale process for the Greatham plant and associated TiO2 pigment assets.
"We recognise the impact this decision has and it is not one we have taken lightly. However, given the prolonged downturn in the TiO2 industry and the financial pressures we face, administration is the most responsible path forward. It allows us to preserve value and create the conditions necessary for a potential future recovery under new ownership."
Approximately 230 employees have been retained at Venator to support administrators, who report the company has faced significant challenges from heightened competition and escalating costs in recent months.
Venator's difficulties stretch back several years, with the group seeking Chapter 11 bankruptcy protection in the US in 2023.
Substantial losses prompted one major shareholder to openly criticise Venator's board over the dramatic fall in the firm's share price since its New York Stock Exchange debut in 2017. Regarding the agreement with LB Group, Ms Askwith described it as a significant milestone for the Greatham site's future.
She said: "It reflects LB Group's confidence in the site's expertise, operational strength and the value it brings to the TiO2 industry.
"There is still important work ahead to complete the transaction. We remain fully committed to working closely with LB Group to navigate the next phase and secure a sustainable future for Greatham."
Ran Xu, deputy chair of LB Group, said: "This agreement reflects LB Group's strategic commitment to supporting European TiO2 customers and expanding its global footprint. The company values the technical expertise and production capabilities at Greatham and welcomes the opportunity to add new high-performance titanium dioxide products to its global portfolio, and to increase its global competitiveness."
At the time, trade union Unite described the agreement as a "step in the right direction" and urged Venator to explore a furlough scheme for employees with LB Group as a contingency measure.
Regional officer Fazia Hussain-Brown noted it would require several months for LB to secure the appropriate licences to operate an upper tier "COMAH" site which manages substantial quantities of hazardous materials. Following the news of Venator Materials º£½ÇÊÓƵ entering administration, Ms Hussain-Brown said: "Our members at Greatham and Wynyard have had the rug pulled from under by Venator today. Unite had committed to working with Venator to support workers during the transition to the new ownership and instead, without warning, Venator has placed itself into administration and potentially destroyed the jobs of over 230 workers.
"This is a cynical move and Unite will be supporting our members over the next few days as the picture becomes clearer of what this betrayal looks like. The local community will be devastated by such a move."
Tees Valley Mayor Ben Houchen remarked: "Today's announcement is deeply worrying, and my thoughts are first and foremost with every worker and family affected by the administrators' decision. It's undeniable that businesses - both here in Teesside and across the country - are under growing pressure.
"The recent National Insurance rise and ongoing uncertainty around the º£½ÇÊÓƵ's economic outlook are making it even harder for companies to plan and invest with confidence. Our chemicals industry has also suffered the further impact of the Government's damaging and short-sighted decision to exclude the sector from its Industrial Strategy.
"Despite this setback, we stand ready to step in and support every worker impacted. My team has already immediately reached out to ensure workers have access to the best possible advice, training, and new employment opportunities. No one will be left to face this alone."
