Already this year the North-East has lost two of its major plcs and a third in North Yorkshire recently agreed to a multi-million pound US takeover bid. Deputy Editor Kate Bowman reports on the recent activity and looks at what effect it is having.

ICE cream maker Richmond Foods announced earlier this month that its board had agreed to a £182m takeover by a unit of US investment firm Oaktree Capital.

The North Yorkshire company is the third in a quick succession of regional plcs to be subject to takeovers by bigger players in their fields.

In February, Australian firm Babcock & Brown Infrastructure (BBI) took control of Teesport operator PD Ports. PD was the subject of a takeover battle in December and BBI's £337m offer trumped an earlier £320m bid from consortium Endeavour Ports.

In March, the UK's biggest car dealership Pendragon, of Nottingham, completed its acquisition of Sunderland-based Reg Vardy for £506m, following a bidding war with smaller Manchester dealer Lookers.

And in April, Richmond Foods, based in Leeming Bar, near Northallerton, North Yorkshire, flagged up the fact it had received a takeover offer and this month the board said it was backing a 750p-a-share offer.

But, while losing big-name companies the region has been used to having on its doorstep, Andrew Sugden, policy director at the North-East Chamber of Commerce, says it will not have a huge impact. "Losing plcs should not and does not have a massive effect if they still keep jobs and functions in this part of the world," he says.

"In the case of PD Ports, for example, it still has a PD board and the day-to-day management of Teesport is done in Teesport and the HR functions remain in the Tees Valley."

In October last year, Birtley-based filtration specialist Domnick Hunter was sold to Parker Hannifin for £251m after it won a bidding war with rival suitor Eaton Industries.

In the same month, Darlington-based van hire group Northgate said it had turned down a takeover approach from an unnamed bidder, which valued the company at nearly £775m.

The North-East has more than 30 plcs contributing significantly to the region's economy and providing thousands of jobs. They include business software group Sage, bakery chain Greggs, mortgage bank Northern Rock and transport group Arriva.

However, Anthony Platts, assistant director at the Tees Valley office of Wise Speke investment management, says the region is relatively weak in terms of numbers.

"If you look at the traditional industries in the North-East, going back far enough, the big companies didn't have their headquarters up here.

"ICI was a major employer, as were British Steel and GlaxoSmithKline, but none had their headquarters in the North-East," he says.

"The region is weak compared to other areas. The obvious reason companies are attracted to London or to the Manchester area is because of access to the City."

He says the number of takeovers in recent times has been above average, driven by low interest rates, but should not generate cause for concern.

"When we lose a plc we can lose the head office and that can be a drain on upper senior management.

"But, in fact, we are seeing more senior management moving to the region because of the beautiful countryside and quality of life," he says.

"Because we have the skills in the region, takeovers in general don't result in loss of jobs.

"When Quorn manufacturer Marlow Foods (in Stokesley, North Yorkshire) was taken over by Premier Foods, for example, it expanded and took on more staff.

"It is also worth remembering that there are many private businesses doing very well in the region and are big enough to float, such as Cleveland Cable and Bulkhaul (both in Middlesbrough) but don't want to."

Rod Wilkinson, KPMG's head of corporate finance in the region, says globalisation has played its part in the current takeover climate.

"As markets get bigger, so do the businesses that serve them. So this won't be the only region seeing formerly locally-owned businesses becoming part of national and indeed international commercial forces," he says.

"However, the ebb and flow of business life means new plcs are created as well as existing ones being 'swallowed', thus replenishing the region's stock of listed businesses.

"A key development in the ability of the region to provide a breeding ground for listed companies is the emergence and success of the Alternative Investment Market (AIM).

"This is more flexible market than the main list, making it a more attractive and practical vehicle for listing, especially important for those smaller companies considering the benefits of floating."

In January, Dermasalve Sciences, of Newcastle, which produces skin products for dry skin sufferers, floated on London's junior stock market, AIM, at a value of £6.57m.

Last year, County Durham-based Hargreaves Services, which operates transport, waste and industrial services, also floated on AIM, as did Northumberland companies BNS Telecom Group, of Prudhoe, and Angel Biotechnology Holdings, of Cramlington.

Mr Wilkinson said: "At the moment, these are arguably relatively small listed companies, but in time and following continued growth, they could prove to be key players that replace the larger existing plcs."