Waterford Wedgwood calls in administrators

Waterford Wedgwood this morning requested that its shares be suspended from trading on the Irish stock exchange following the appointment of a receiver.

In a statement the company said the request follows the appointment of David Carson of Deloitte as receiver to the Irish arm of the company and certain Irish subsidiaries, and the expected appointment later today of a three-person team of Deloitte administrators to Waterford Wedgwood UK plc and certain UK subsidiaries.

Waterford Wedgwood is involved in the manufacture, wholesale and retail of Waterford Crystal, Wedgwood fine china and Royal Doulton fine china products around the world. The companies employ 800 staff in their Irish operations.

The business - which had been in talks with a private equity investor over much-needed funding - will continue to trade while discussions continue. The company had been unable to raise operating capital in recent months and has posted nearly six years of consecutive losses.

"As trading conditions deteriorated, it became apparent that a restructuring of the businesses could not be achieved in an acceptable timescale," the company said.

A forbearance period enabling the company to meet loan payments had expired January 2.

"Following the expiration and non-renewal of the forbearance period, certain Group companies have now been placed into receivership or will shortly be placed into administration," the company said.

Mr Carson commented: "I have today been appointed Receiver of the Companies and will be continuing to trade the business while seeking a sale as a going concern.

"My team will work closely with the management and employees together with customers and suppliers to ensure operations continue effectively and efficiently while a sale of the business is sought. Waterford, Wedgwood and Royal Doulton are classic brands which are steeped in history."

The appointment of administrators comes despite attempts to revive the struggling business since 2005 by majority owners Anthony O'Reilly and Peter John Goulandris. Mr O'Reilly also controls media firm Independent News & Media.

As well as axing thousands of jobs, Waterford has embarked on marketing initiatives and launched new products in a bid to increase the appeal of its luxury goods – signing up stars such as chef Gordon Ramsay and designer Terence Conran to launch more modern lines.

It introduced products such as Wedgwood’s Eternity China, which is much stronger than traditional china and able to stand up to use in microwaves and dishwashers.

But the firm suffered from funding issues and was weighed down by the cost of its restructuring efforts. In the year to April, Waterford made a pre-tax loss of €241m, and carried net debt of €488m.

The firm was also hit by the onset of the financial crisis in the autumn, with sales in October 19% down on the comparable period in 2007.

Mr O'Reilly said: "I want to commend the Board and the executives, the Irish and UK governments, our suppliers, our customers and our employees for all of their support and efforts.

"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."

Crystal maker Waterford was set up in 1783 by brothers William and George Penrose.

In 1986 Waterford acquired Wedgwood to form the present company, listing on the stock exchange and expanding overseas in the 1990s before buying Royal Doulton in 2005.