An "indicative cash bid" has been made for Donside Paper Company just hours after it appointed PricewaterhouseCoopers (PWC) as administrative receiver.


A spokesman for PWC said it planned to "sell the business as a going concern".


The spokesman said PWC would "seek to reduce the level of costs at the firm", adding that it "may entail some redundancies".


The administrative receivership is the latest blow to hit Donside. Last month, chief executive Bill Gore stepped down after putting together a re-financing package proposal and Premier Paper started legal action (PrintWeek, 24 November).


Donside said production would be unaffected by the current situation.


Its latest accounts show it lost 4.53m in the year to 2 August 1998, and had total liabilities of 48.2m, including a 17m bank loan.


Donside chief executive Mike Duckett said the appointment was "in the interests of the business".


"Despite a high demand for our products, the firm has experienced difficult trading conditions as a result of high pulp prices and the strength of the pound."


Howard Smith Paper, the merchant for Donside's main Consort product, said it would continue to work with the group and "looked forward to the new ownership".


Premier Paper managing director David Rogan said he was sorry to hear of the group's plight "irrespective of the current business relationship between ourselves and Donside".


And PWC confirmed Donside had received strong support from customers and suppliers.


Donside employs 370 people at its single site mill in Aberdeen, which has a capacity of 90,000tpa of coated woodfree paper. It also employs 18 staff in its US distribution operation.


Story by Andy Scott