Advanced data centre optical transceiver manufacturer, Kaiam’s UK and Europe operations have gone into administration.
Blair Nimmo and Alistair McAlinden of KPMG were appointed as joint administrators for Kaiam Europe and Kaiam UK on Friday 21 December 2018. The administrators convened a meeting of all employees on 24 December at the Livingston, Scotland facility, and, due to factors such as trading losses, absence of material customer orders, and significant fixed costs of operating the facility, the decision was taken to make 310 of the 338 employees redundant with immediate effect.
Established in 1998, Kaiam Europe manufactures components for high speed data transfer in data centres. The Lothian manufacturing premises is owned by subsidiary Kaiam UK. The company was affected by declining work levels last year, which, coupled with a high fixed cost base, resulted in the business facing significant cash flow difficulties. The remaining 28 employees have been retained to help the administrators explore a sale of the business.
Blair Nimmo, joint administrator and KPMG’s global head of restructuring, commented: ‘We fully recognise that redundancies at this time of year are particularly difficult. Our main focus during this challenging period is to work with all affected employees alongside Scottish Enterprise, Skills Development Scotland and West Lothian Council to ensure that the full range of support is available to them.
Partnership Action for Continuing Employment (PACE), the Scottish Government’s partnership framework for responding to redundancy situations, has already mobilised and can be contacted on 0800 917 8000 for support. We are also liaising with the UK Government in relation to the timing of redundancy payments via the Insolvency Service. In the short term, we are exploring all available options for a sale of the business and would encourage any interested parties to contact us as soon as possible.’
In an email distributed on 3 January 2019, former VP, worldwide sales and marketing, Jeremy Dietz stated: ‘I regret to inform you that my team and I are no longer with Kaiam. We enjoyed serving each and every customer as well as working with our partners. We are saddened by the abrupt ending but it was not without a tremendous effort by Bardia [Pezeshki, CEO at Kaiam Corporation], the executives and our board members to avoid this outcome. Please join me in wishing all involved the best of luck in any and all future endeavours.’
US-based parent company Kaiam Corporation is not subject to these administration appointments.