Body armour specialist files for administration

A manufacturer of body armour used by soldiers in Afghanistan and more than 25 police forces across the UK, has gone into administration having posted a pre-tax loss of £82,000.

The AIM-listed, Warrington-based Shieldtech had its shares suspended on Monday and 60 staff have been made redundant. RSM Tenon Recovery has been called in to carry out the administration.

Gareth Roberts, from RSM Tenon said that a skeleton staff has been kept on while the firm seeks a potential buyer or investor - hopefully within the next seven to ten days. He said, "There were several expressions of interest prior to our involvement so we’re now getting in touch with them."

He added that they would know by next week whether they would be able to stage a resurrection of the business - preferably through a buy-out of it in its entirety.

A statement from the board of the company revealed a problem with invoice discounting facilities with a major bank, which had had a major impact on the company's working capital. The statement read, "The board has continued to vigorously explore all possible options to address its short and medium term financing requirements and has been in negotiations with a number of parties."

At the suspension of its shares on Monday, the company was valued at around £1m. The business posted a pre-tax loss of £82,000 in the six months to 31 December, compared with a £49,000 profit a year earlier.

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