Historic Dundee factory to close with loss of nearly 60 jobs

The business, which dates back to 1903, had been saved twice already this year.

By Gavin Harper

October 26 2023, 10:33am

The Newman Bonar premises in Dundee. Image: Google Maps.

A historic Dundee manufacturer that was saved from closure twice earlier this year has appointed liquidators, with the loss of nearly 60 jobs.

Bonar Yarns, which specialises in polypropylene carpet backing yarns, collapsed into administration in April.

It was then rescued by one of its American customers, John Newman, who formed a new company called Newman Bonar.

But in June, the business was again on the brink of closing due energy costs understood to be in the region of £300,000 a month.

Again, it found a way to continue trading after negotiating better terms with its energy supplier.

But on Thursday it was confirmed liquidators have been appointed for Newman Bonar.

‘Intense challenges’ for Newman Bonar

The majority of the 57-strong workforce have been made redundant immediately.

A small number of employees have been retained by the liquidators to assist with the winding up process.

A statement from the liquidators, Geoff Jacobs and Blair Nimmo from Interpath Advisory, said Mr Newman had tried to stabilise the business.

It adds he provided “significant” funding to keep the business operational.

The Newman Bonar factory at Caldrum Works in St Salvador Street, Dundee. Image: DC Thomson

However, the company has faced “intense challenges” including significant increases in energy costs.

It also had “significant ongoing overhead costs”, the liquidators said.

They meant Newman Bonar was unable to re-establish contracts with key customers at a sufficient level to make the business viable.

Newman Bonar closure ‘very disappointing for Dundee’

Liquidator Blair Nimmo said: “This has been a well-known Dundee business for many years with a strong global reach.

“It is extremely disappointing for the company’s many stakeholders, funders and employees that it could not continue to trade viably.”

Blair Nimmo, chief executive of Interpath Advisory. Image: Interpath Advisory.

Meanwhile Geoff Jacobs said: “This is very disappointing for Dundee to see the closure of a long-standing business.

“Our focus will be on supporting the employees affected, and securing and realising the assets of the company.

“They primarily comprise its name, customer base, stock and plant and machinery.”

‘Difficult outcome’, says owner

Mr Jacobs, managing director at Interpath Advisory, urged anyone interested in rescuing the business to come forward.

“If any party has an interest in acquiring the business and/or its assets, they should contact the joint provisional liquidators as soon as possible,” he said.

The statement from the liquidators said Mr Newman wanted to thank staff for their efforts.

Almost all Newman Bonar staff have been made redundant.

It added he recognised the closure was a “difficult and disappointing outcome” for everyone involved.

Unite the Union has pledged its support for the staff affected.

Dougie Orchardson, Unite industrial officer, said: “Over 50 workers based at the factory have now faced a redundancy situation three times in the space of six months.

“There needs to be clarity over the future of the factory, and we believe that this can involve it remaining open.

“However, in the situation where it can’t be saved, Unite will give all possible support to our members.”

Bonar Yarns can trace its history back to the foundation of the famous Low & Bonar business that specialised in the manufacture of technical textiles in 1903.

In May 2020 Low & Bonar was delisted from the London Stock Exchange after a £107m sale to German firm Freudenberg.

The Dundee management team completed a deal to purchase the Bonar Yarns division.