ENGINEERING company Kvaerner, which employs more than 1,500 people on Teesside, appears to have been saved from the brink of collapse by a new rescue deal.

The group, and its largest shareholder Aker Maritime, have reached an agreement about an industrial and financial package that could keep the Anglo-Norwegian company afloat.

The proposal, which will be voted on today, replaces an original rescue plan put forward by Kvaerner's second largest shareholder, Russian oil company Yukos, to whom Kvaerner sold its research and development businesses in October for £66m.

The plan has the backing of Yukos, which is expected to withdraw its own plan.

The Aker Maritime proposal will result in new equity for Kvaerner through a rights issue, and the merger of Aker Maritime's core business with Kvaerner Oil and Gas.

The main elements of the agreement include:

l A merger of Aker Maritime and Kvaerner Oil and Gas.

l A directed equity issue of at least £162m.

l A rights issue for Kvaerner shareholders of up to £122m.

A spokesman for Kvaerner said: "The merger of Aker Maritime's core operations with those of Kvaerner Oil and Gas will create a strong new player in the petroleum industry, with a substantial potential for international growth.

"Aker Maritime and Kvaerner Oil and Gas complement each other, both in terms of technology and products, and within operations and maintenance."

Kvaerner's financial freedom will be further strengthened by the deferral of debt repayments of about £30m, for ten years.

The revised Kvaerner plan will be presented to shareholders for final approval at an extraordinary general meeting to be held no later than December 19.

The engineering and construction concern, which has about 35,000 employees worldwide, has gone from crisis to crisis in recent weeks, seeking long-term financing solutions to keep its operations running, despite debts.

Earlier this week, Kvaerner claimed it needed £20m by the end of the month to keep it afloat until a deal could be agreed on its future.