The future of specialist castings and machining group Chamberlin has been placed into serious doubt after it was issued with a winding-up petition and its shares were suspended from trading.
The Walsall-based firm, which sells iron castings and engineering products, has confirmed that it been issued with the petition by the company’s main power supplier. Chamberlin said the petition would be heard on July 2.
In a statement issued to the London Stock Exchange, Chamberlin said: “The company will discuss the current position with its creditors and major shareholders but, pending conclusion of those discussions and clarification of the company’s financial position, Chamberlin requested that trading in the company’s ordinary shares on AIM be suspended with immediate effect.
“Notwithstanding the suspension of trading in the company’s ordinary shares, the company will continue to make notifications as and when there are matters requiring disclosure in accordance with the company’s obligations under the AIM Rules for Companies and/or the UK Market Abuse Regulation.
“Further announcements will be made, as appropriate, in due course.”
The news comes after shares in Chamberlin plunged after it hiked prices and announced a wide-ranging cost cutting programme to tackle a slowdown in demand.
On April 10 the business said underlying demand over the third quarter had been lower than expected and that lower sales also “negatively affected profitability and working capital”.
A week before, Chamberlin announced its chairman Keith Butler-Wheelhouse and finance director Alan Tomlinson intended to depart.
Chamberlin recently sold its specialist industrial manufacturing subsidiary, Petrel Ltd, in a £3m deal with Project Apollo, part of the investment firm Longacre Group.
The group made pre-tax losses of £1.1m last year and said it was “adversely impacted by the effect of icnreases in the Bank of England base rate on financing costs.”