Sign up to BQ Breakfast to receive daily news:

Fallen angel fighting for survival

Monday 11 February 2013 6:00

Administrators say they are hopeful of securing a rescue deal for drugs company Angel Biotech, which faces an uncertain future amid cash flow issues and the breakdown of talks with two potential new partners.

The group, which covers Angel Biotechnology and Angel Biomedical, was originally founded in Cramlington, Northumberland, before later shifting the bulk of its work to Edinburgh.

However, since 2010 it has raised around £2m through shareholders to invest in redeveloping its Cramlington site with a view to relaunching there in the near future.

But Blair Nimmo and Gary Fraser of KPMG LLP have now been appointed joint administrators of the group  on the back of incurred losses, most recently as a result of difficult trading conditions.

This has led to cash flow difficulties and therefore further investment being required in the companies.

The directors had been in negotiations with two potential joint venture partners, however, these negotiations could not be concluded.

As a result, the directors took the decision that they had no option but to place the companies into administration.

Blair Nimmo, head of restructuring for KPMG in Scotland, said: “Angel Biotechnology and Angel Biomedical have worldwide reputations for the quality of their production facilities, understanding of global regulatory regimes, and being at the cutting edge of pharmaceutical and biotechnological manufacturing.

“We are hopeful that the companies, and their employees, will have a positive future given their unrivalled credentials and quality of service.

Share-trading in the AIM-listed group has ceased.