Waterford Wedgwood collapses under debts

Hundreds of jobs are under threat at the group's pottery factories in North Staffordshire and at its crystal glass works in Ireland.

Chairman Sir Anthony O'Reilly, who has pumped hundreds of millions of euros of his family's fortune into the business over the past 20 years, admitted that today's move was a huge ­disappointment.

He said: "We are consoled only by the fact that everything that could have been done, by management and by the board, to preserve the group was done."

Waterford Wedgwood has been in crisis talks with its banks for several weeks as it tried to deal with its £377 million mountain of debt.

The institutions, led by Bank of America, had given the firm an ulti­matum of last Friday to demonstrate its financial health.

An unnamed ­private equity house was reported to be have been very close to doing a deal to buy the business for about 600 million (£568 million).

But those talks foundered and the banking consortium voted to pull the plug over the weekend.

"I am disappointed that certain of the group's UK and Irish subsidiaries have had to go into administration and receivership, but we remain optimistic that ongoing discussions will result in a buyer being found for the businesses," David Sculley, chief executive, said.

Although Waterford Wedgwood's immediate collapse was ­exacerbated by the credit crunch, the business has been in long-term decline.

While many rivals switched manufacturing to low-cost countries in the Far East, Waterford Wedgwood retained factories in this country and Ireland, only recently opening a factory in ­Indonesia. More recently, it has been hit by rising fuel costs and difficult export markets.

In the year to last April Waterford Wedgwood's sales fell by 9% to 672 million, while its pre-tax losses soared from 71 million to 242 million.

This morning Deloitte was called in as receiver to the Irish businesses and administrator to those in the UK. It said it planned to continue trading all the businesses while it seeks a buyer or buyers.

Waterford employs 800 people in Ireland, Wedgwood has about 600 staff in Barlaston, near Stoke, 170 people in 19 shops and 60 at its London head office. The group has already laid off about 350 since August and has cut its workforce by some 4,000 since 2005.

The group's shares were suspended in Dublin at 0.1 eurocent this morning. It was delisted in London last month.