THE last remaining paper mill in Aberdeen is under threat of closure with the potential loss of 500 jobs after administrators were called in to seven British companies owned by French parent firm Sequana.

Historic Stoneywood Paper Mill was put up for sale last year by owners ArjoWiggins, a subsidiary of Sequana, and it appeared that a deal to save the mill had been done, only to fall through.

Stoneywood appeared to have been sold as part of a deal for the entire graphic and paper businesses of Sequana to be acquired for £111 million by Dutch firm Fineska. That sale collapsed in late December.

Administrators FRP advisory say the business will continue to trade while they try to find a buyer but Unite union and local politicians are fearful that all 498 jobs at the 250-year-old mill could go.

A spokeswoman for Sequana said: “Following the receivership proceedings opened in France at the request of Arjowiggins and some of its subsidiaries, the boards of directors of some of Arjowiggins’ companies in the UK have decided to file notices of appointment of an administrator for the following companies AW UK Holdings Ltd, Arjo Wiggins Fine Papers Ltd (owners of Stoneywood) ArjoWiggins Chartham Ltd, AW UK Holdings Ltd, Arjowiggins Sourcing Ltd, Arjobex Ltd and Performance Papers Ltd.

“These companies operate the mills of Stoneywood, Chartham and Clacton. Under the aegis of administrators, these procedures will help support the measures undertaken to find buyers for Arjowiggins’ businesses.”

Joint administrator Iain Fraser said: “The Stoneywood Mill in Aberdeen has a long tradition and reputation for producing fine and creative papers of the very highest quality for a global customer base.

“Unfortunately, the business has been severely affected by rising costs and difficult trading conditions, and the insolvency proceedings begun in France left the directors no option but to place the UK companies in administration.

“We will continue to trade the business whilst exploring all options for securing a future for the site.”

Minister for Business, Fair Work and Skills Minister Jamie Hepburn said: “I am concerned to learn of the situation with Arjowiggins based in Aberdeen.

“I have spoken directly with the managing director of Arjowiggins and the General Manager, Stoneywood Mill and communicated our full support.

“Our focus at this stage, is on supporting the business and doing all we can to try to minimise the impact on the workforce. My officials in Scottish Enterprise have been in contact with the management at Arjowiggins to support the company in its plans going forward to secure a new buyer.

“Unfortunately, the negotiations initiated in July 2018 with Fineska BV (the Andlinger & Company group) for the sale of Arjowiggins’ Graphic and Creative Papers businesses ceased due to market trading conditions out with the control of the company.”

Unite’s industrial officer Tommy Campbell, said: “Unite is seeking clarity about the position of the site. If it is indeed the case that the company is in administration, we will seek an urgent meeting with representatives of the company as well as the Scottish Government to see what can be done to find a buyer and save jobs at this site.

“This is an anxious time for staff at the plant, and for the local economy of the North-East.

“Stoneywood has been a very successful business for almost 250 years, and these workers and their families deserve a future.”