'Rescued' car parts group closes

Staff could not get into work to collect their personal belongings

A Sheffield-based car parts group, which appeared to have been rescued in a takeover deal last week, has been unexpectedly closed by its new owners.

Euro Car Parts (ECP) bought LSUK, which has 600 staff nationwide, from holding company Pinco 1555 Ltd last Wednesday.

In a letter to staff, chairman Sukhpal Singh said he had no plans to cut jobs.

However, shocked staff turning up for work on Monday found themselves locked out and a notice on the door telling them the company had ceased trading.

LSUK has about 110 staff at its head office in Sheffield and two branches in Sheffield and Doncaster.

'Exceptional circumstances'

The notice, which has been posted at its 53 branches nationwide, said: "It is with great regret and due to unforeseen and exceptional circumstances beyond our control that with effect from Monday 6 October this branch will cease to trade."

An ECP statement said: "Unfortunately, it became clear, very quickly, that it was simply going to be impossible to continue with investment without the required support, which was not forthcoming.

"After a considerable amount of non-stop work and investment into LSUK over the past five days, the ECP directors realised that they had no option but to place LSUK into administration with immediate effect."

Lead administrator Tenon Recovery is in contact with several interested parties for LSUK, ECP added.

In his letter to staff last week, ECP owner Mr Singh said: "I would like to take the opportunity to give reassurance on the future of LSUK and its subsidiaries.

"I regard LSUK as a fine business, with some valuable specialisms and dedicated staff, that has suffered from underfunding in the recent past.

"I will seek to develop the business over the coming years and provide the necessary financial stability."

'No consultation'

One senior manager, who did not wish to be named, told BBC News on Monday: "Senior managers of ECP and a director of ECP Logistics Ltd were in Sheffield head office last week making assurances to staff that they intended to keep LSUK as a separate brand.

"Branches would be invested in and staff at HQ would get at least five months' notice if the HQ was to close and be integrated into ECP HQ in Wembley.

"This morning 600 people who were told that they had at least the chance of a short to medium term future last Tuesday will turn up for work to be faced with no job, no consultation and being unable to get their personal belongings.

"A high number of these people have over 25 years service with the company with a reasonable number having worked for LSUK in some format since they left school, often over 40 years ago."

The manager said that after last week's takeover, an internal document was issued to staff advising that "your contract has been transferred, there are no alterations".

On Friday a large number of new computers bought by Pinco 1555 Ltd for its new computer system were removed by ECP, the manager said.

On Saturday, locksmiths turned up at the head office and branches to change all the locks.

As well as its branch network which supplies car parts and motoring services, LSUK operates subsidiaries M I Diesel Products, Protech Automotive (UK) and Yeovil Rewind.

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