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Factory sale to cost 600 jobs

Date 10 Oct 2007

More than 600 jobs are to go on Tyneside with the closure of an American-owned microchip plant. It was announced yesterday that Atmel is to sell its factory at Silverlink, North Tyneside, to a business park developer, with equipment going in a separate deal to Taiwan.

The company, which was promised almost £28m in government relocation grants, said in 2006 that the plant was likely to go because of planned restructuring. The firm is to be asked to return £19.9m in grants already paid.

Atmel, one of North Tyneside's largest employers, took over the former Siemens electronics plant, which itself closed less than a year after it opened in 1997. The factory is expected to cease production in the spring of 2008.

Atmel's North Tyneside managing director Craig McInnes said: "This has been a difficult decision to take, and is no reflection on the highly-valued work performed by our employees, here in Tyneside. We are committed to treating employees with respect and helping ease the transition for employees at the North Tyneside facility as production is concluded."

Alan Clarke, One NorthEast Chief Executive, said: "Today's announcement is very disappointing for the workers and the region. It comes after many months of protracted negotiations between Atmel and potential purchasers.

"Our priority now is very much the staff and their future. The public sector has mobilised a response group - headed by North Tyneside Council - to lead this assistance. The group comprises North Tyneside Council, One NorthEast, Job Centre Plus, Business Link North East and the North East Chamber of Commerce. The group's primary aim is to provide the maximum package of help for every worker. This includes assistance with identifying new job opportunities, access to retraining, CV updating and identifying available benefits.

"We will be seeking assurances from the company regarding the new owners' intentions for the site."

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