A FAMILY bakery firm has put up a substantial reward after learning that arson is suspected as the likely cause of a fire which gutted its Durham factory.

Peters Cathedral Bakers is offering £10,000 for information leading to the arrest and conviction of whoever was responsible for the blaze, which destroyed the company's bakery headquarters, on Dragonville Industrial Estate, on Sunday, April 26.

But investigators admit they have so far failed to identify who started the fire, which developed in a store room containing plastic bakery trays.

Det Insp Mick Nail, of Durham CID, who is leading the inquiry, said: "Having established where it began, fire service investigators have ruled out an electrical fault, and it seems likely someone started it deliberately. We've interviewed all 60 members of staff who were on duty around the time the blaze began, at around 4pm, and no-one has come forward with any useful information."

Peters' managing director Richard Knowles said: "We're absolutely sickened to learn that a fire which endangered lives, threatened the livelihoods of 700 people and destroyed the work of 40 years could have been started deliberately.

"From what we can gather, the fire brigade has found that a fire started at the fairly isolated far end of the bakery. If this is the case, it's absolutely imperative that we find out who did start the fire, if indeed it was arson."

Mr Knowles, whose father Peter founded the business in 1966, said the company and its insurers have jointly put up the £10,000 reward.

In the wake of the fire, the bakery transferred to the former Hibernia Foods factory in Peterlee. Following a rapid fitting out of the disused unit, production resumed and all Peters' 71 shops across the region reopened at the end of May.

Anyone with information should call Durham CID, on (0191) 3864 222, or, anonymously, on Crimestoppers (0800) 555111.