The company used to employ 3,000 people

The union representing the workforce at an engineering factory in Cornwall is to start redundancy negotiations.

CompAir UK Camborne announced on Friday that it is to close in September with the loss of about 180 jobs.

The company, previously known as CompAir Holman, makes compressed air equipment and has been established in the town for more than 200 years.

The firm's parent company claims it cannot compete in the international business market.

It is very, very sad news Candy Atherton MP

In its heyday, the company was west Cornwall's largest employer and was at the centre of Camborne's economic boom, providing work for more than 3,000 people.

But it has faced several problems over the past few years and has been forced to lay staff off during that time.

Four years ago, the company was given several million pounds by the government to help with restructuring.

Candy Atherton, the MP for Falmouth and Camborne, said the company was struggling when it got financial aid.

She said: "Four years ago the company came to me and said if the government did not give them in the region of �8m to �10m, they would close that very day.

"We worked hard and several million pounds was allocated in selective assistance to help the company restructure."

She said of the announcement of the factory's closure: "It is very, very sad news."

'Cornish tenacity'

The Amicus-AEEU union said the announcement of the closure had come as a "bolt out of the blue".

However, economic leaders in Cornwall have already stated the impact of the closure of CompAir might not be as bad as first envisaged.

Kerrier District Council economic development officer Roger Hook said the job market in the Camborne area was better than five years ago and people might be absorbed into other industries in the area.

The Finance Cornwall investment fund has said the company might still have a bright future.

Finance Cornwall Chief Executive Robin Teverson said: "Cornish tenacity is fantastic and there is a track record down here of turning around companies like this."

"If we can show there is a viable financial future for the business, companies will put some shares money in or maybe some loans."