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The closure of the UK’s largest fibre glass factory was confirmed on Wednesday despite efforts by ministers to find a last-minute buyer, in a blow to the government’s industrial strategy.
Electric Glass Fiber UK, which manufactures glass fibres used in electric cars and wind turbines in Wigan, employs about 250 people and has been hit by a combination of weak sales and Britain’s high industrial electricity prices.
The factory’s Japanese owner, Nippon Electric Glass (NEG), decided in a board meeting in Tokyo on Wednesday to close the site. In April the company warned it would be forced to shut the facility if a buyer could not be found within two months.
NEG confirmed in a stock market filing on Wednesday that it would cease the factory’s operations and prepare for voluntary liquidation, after considering various options during the review period. Production would stop in late June, it added.
A group of UK officials including business secretary Jonathan Reynolds, Greater Manchester mayor Andy Burnham, and Sir Keir Starmer’s business adviser Varun Chandra had tried to facilitate a rescue deal for the site, according to people with knowledge of the talks.
Tegu, a little-known London-based investment vehicle, had been in exclusive negotiations to buy the site but had asked the government to underwrite £5mn of financing for the deal.
However, ministers had declined to do this, and the talks then fell apart, the people added.
Tegu chair Jack Khan told the FT: “The fundamental issue here is that the UK government is standing by and watching British industry collapse.”
A separate private equity bidder also put in an offer with £10mn upfront, but was deterred after Nippon demanded a £2mn break fee.
NEG said losses at the unit deepened to £12mn last year. The most recent accounts, for the year to December 2023, showed a loss of £3.5mn after tax on sales that fell 17 per cent to £56mn.
As well as high energy costs, the UK plant came under severe pressure from a sharp increase of Chinese imports of glass fibres into Europe.
Burnham is in Japan on Wednesday for a meeting with Nippon executives, but this may not occur until after the closure decision is already made.
Josh Simons, MP for Makerfield where the factory is based, said he was “angry and bitterly disappointed about this outcome and sceptical [Nippon] were ever serious about saving these jobs and selling the plant”.
He said the Japanese company “created a new problem for every one that we solved”.
“As the chancellor said, we live in a world where it matters who makes things and where,” he told the FT. “I will continue to work relentlessly with government to make sure that places like Hindley Green have a bright industrial future.”
The government said that industry minister Sarah Jones met recently with Nippon, “and we continue to work with them to understand the challenges they are facing in Wigan and ensure the UK’s glass industry is globally competitive”.
It added: “We are supporting companies like this one in energy-intensive industries through our British Industry Supercharger, which is expected to reduce electricity prices for businesses . . . by over £5bn over 10 years.”
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