Thursday, 16 August 2012
Dawson International in administration
Dawson International, the cashmere making company that owns Barrie Mill in Hawick, has gone into administration following a hole in its pension fund. The company employs 180 people and makes cashmere for some of the worlds best known fashion brands. Blair Nimmo and Gary Fraser of KPMG LLP are the administrators.
The move follows rejections by the Pension Protection Fund of offers to resolve the company's large pension deficit. It would be able to do this by transferring its defined benefit pensions into the protected fund as the company was unable to meet its liabilities. In a statement the Chairman, David Bolton said:
“This is a sad day for Dawson International, and for British manufacturing. To see this 140-year-old company forced into administration due to the PPF’s decision is deplorable, a direct consequence of a flawed process lacking in common sense and transparency."
He also went on to say; "It should be noted that there is no intention to appoint administrators for the US knitwear business, Dawson Forte, which is well funded and continues to trade normally.
In a strongly worded statement the CEO blamed quantitative easing and high fees on the deficiency and the inability of the Protection Fund to realise that the outcome in administration would be much worse than the measures the company was proposing to continue funding the scheme. He went on to criticise the decision process as being flawed and took far too long 15 months from when the company's proposals were submitted.
For more information on pension issues look at our page on pensions funds and insolvency.