By Prasun Sonwalkar, IANS
London : The new Indian owner of British cable major AEI Cables has assured employees that there will be no job losses in the near future but has not ruled out the possibility later.
New Delhi-based cable maker Paramount Communications bought AEI Cables, based in Birtley in northeast England, in September for 13.3 million pounds (about $27 million). Paramount Communications has retained AEI Cables’ management team.
AEI Cables’ parent company is Surrey-based TT Electronics, which sold the loss-making company at a discount to reduce its borrowings. Its assets are estimated to be worth around 26.5 million pounds. AEI Cables employs 314 people, many of whom fear job losses under the new owner.
Paramount chairman and chief executive Sanjay Aggarwal told the local media: “We have no plans of cutting jobs currently but we will review this at regular intervals and if there is any overstaffing, we will have to work out something.”
The company has been in operation at its site off Durham Road in Birtley since 1950 and serves a number of industries including construction, defence, mining, oil and gas, power and rail.
In a statement made to the stock market, TT Electronics said: “The disposal of AEI Cables is an important step towards increased concentration on our electronic activities and follows the closure of the power cables division in 2005.
“This is in line with our strategy of rationalising our non-core activities. Our electrical division now comprises profitable businesses manufacturing non-commodity, high margin products.”
One NorthEast, the regional development agency, said its representatives had met Paramount representatives in India to learn more about their investment plans for AEI. A One NorthEast spokesperson said: “We understand the investment will be good news for AEI Cables, with many jobs safeguarded.
“Paramount is a successful Indian company with a business rationale of growing AEI Cables in the North East and introducing some of the latest manufacturing techniques into the Birtley business.”