Administrators Take Over UK’s Armstrong

John Wolz

Administrators took over UK bolt manufacturer Armstrong Fastening Systems. Armstrong and other auto parts subsidiaries of the Caparo Group were forced into bankruptcy on March 13, 2006, by pension fund deficits, receivers PricewaterhouseCoopers LLP announced.
Armstrong is the UK Helicoil licensee. Armstrong reported “break-even” finances for 2005 and Matthew Hammond of PwC noted that the “businesses are currently operating with a full order book and manufacturing is ongoing.”
Observers commented that the elimination of pension liability makes the subsidiary more attractive for potential buyers.
Caparo Group has separate financial affairs and continues to trade normally, according to a Reuters report.
Armstrong Fastening Technologies reported 2005 sales of �25 million (US$43.7 million) and employs 330.
Also filing for bankruptcy were subsidiaries Armstrong Fastening Systems, an aerospace fastener manufacturer with 50 employees, and Willenhall Manufacturing Ltd., which produces metal pressings for the automotive market and employs 100.
Armstrong pensions had been scaled back since 2002 but obligations remain for previous employees.
Calling in the administrator may relieve Armstrong of pension liability for 3,000 employees. Pension participants may now be able to qualify for the British government”s Financial Assistance Scheme, which was designed to protect people prior to the Pension Protection Fund.
“In common with many companies at this time, Armstrong Fastenings and Willenhall Manufacturing have suffered from the difficulties of a significant pension deficit,” Hammond explained.
Caparo Group CEO Angad Paul told reporter James Daley of the UK Independent newspaper that it is a “bizarre world when a pension fund can access government subsidy only by closing down a successful firm and damaging its suppliers. This could not have been the intention behind the FAS.”
Only 4% of the pension recipients will benefit while bankruptcy threatens 450 jobs, Paul warned.
Hammond hopes for the support of employees, key customers and suppliers in selling “all or part of the businesses, safeguarding the jobs of the workforce.” Web:
armstrongfastenings.co.uk or afscaparo.com
Editor’s Note: Fastener & Fixing Europe contributed to this article. \ �2006 FastenerNews.com