A DEAL to see a North East company take over a troubled food factory lay in tatters last night, leaving the site’s future in doubt.

Administrator Begbies Traynor revealed it has rescinded a contract with Longbenton Foods to buy the former Northumberland Foods factory at Amble.

The administrator confirmed Longbenton Foods had failed to come up with money owed for its purchase of the site due to lack of funds, and had missed several payment deadlines. Begbies Traynor said it would be continuing its efforts to find a new buyer for the factory.

Contracts for the sale of the site were exchanged on October 22. The administrator yesterday revealed a non refundable deposit had been paid, and the company was allowed to move into the site and begin operations.

The administrator has now revealed that Longbenton Foods was set a deadline of November 22 to complete the deal, but the company was “not in funds” and the sale was not finalised. Begbies Traynor was granted a high court injunction preventing the company using the factory until payment was received.

The administrator says it granted a number of extensions to allow the company to raise the necessary funds, the last of which was on December 22. Payment was still not made and the administrator served a “notice to complete” giving Longbenton Foods until Thursday to raise the necessary funds.

However, the money was still not paid so the administrator rescinded the contract – a move it said it has carried out “with regret”.

Its statement said: “The administrators owe a duty to all creditors to maximise realisations and have, therefore, decided that, given Longbenton Foods’ continued inability to raise the necessary funding to complete the transaction, it is appropriate to rescind the contract.”

The company said it is now continuing its efforts to sell the site, with The Journal having revealed earlier this week that the factory and its contents were being offered for sale online by industrial auction company Sweeney Kincaid.

Longbenton Foods failed to comment.