HUNDREDS of jobs have been saved at a North-East company threatened with closure.

A £3.75m Government grant has safeguarded the remaining 800 highly-skilled jobs at Viasystems' South Tyneside plant.

The cash supports former company accountant Charles Brookes, who led a last-minute management buyout of the firm.

Workers at the plant accepted a 25 per cent pay cut to ensure the buyout succeeded but have been offered a 30 per cent share option in the new firm.

Dr John Bridge, chairman of One NorthEast, the regional development agency, said: "I am absolutely delighted by the announcement. This really is a marvellous example of the region's public and private sectors working together to pull off this fantastic achievement.

"The news that the South Tyneside plant has been saved is wonderful for the employees in the run up to Christmas."

Mel Barras, regional organiser for the AEEU union, was equally ecstatic.

He said: "Workers agreed to pay cuts and a reduction in hours as they realise the new bosses have got to have time to get the firm back on its feet.

"We always knew we had a first class workforce - now we have a first class management to match. There is work at the site now, but we need to secure more contracts to get the firm really moving forward."

Receivers were called into the factory in September after its US owners, Viasystems, said they were pulling out of South Tyneside and their Longbenton plant due to a downturn in the electronics market. More than 850 workers at the company were sacked as a result, and the company's Longbenton factory shut down.

Councillor Paul Waggott, leader of South Tyneside Council, was also delighted after the buyout proposals for Viasystems were accepted by the receiver.

He said: "The loss of the last 800 to 900 jobs at the plant would have been a terrible blow for the area, further exacerbating South Tyneside's unenviable position of the local authority with the highest unemployment rate in the country."

Announcing the grant, Trade and Industry Secretary Patricia Hewitt said: "The grant will help retain in the North-East a facility capable of delivering high quality, technically complex printed circuit board products.