HUNDREDS of North-East workers are on a knife-edge after shipbuilder Cammell Laird called in the receivers.

The company, which employs some 800 workers on the Tyne, Tees and Wear, said a series of events had caused "significant damage" to its trading and financial position.

The firm, which has its headquarters at Birkenhead on the Mersey, said its directors would do what they could to help the receivers salvage a future for the business and safeguard jobs

Last night's dramatic turn of events is the latest problem to hit the company, which has been in turmoil since November, when it lost a £50m ship repair deal with Italian firm Costa Crociere.

It has also been kept waiting for Government financial support to help it fulfil a £300m contract with US luxury cruise liner group Luxus.

The company has now launched a plan to refocus the business.

A statement from Cammell said directors had launched a strategy to reorganise the business and steer it towards a possible sale.

But a cashflow crisis grounded the rescue plan.

Kevin Curran, the GMB Union's Northern regional organiser, said it had been working closely with the company to win fresh orders and any threat to the future of the yard would be tragic for the workforce.

He said: "The terrible tragedy about this whole incident is that the company is a good one. The management is dynamic and progressive and the workforce has been excellent."

The union is set to lobby the Government for help in supporting any potential buyer of the company.

He added: "In the medium to long term I'm sure there will be work for people here, it is a good facility and a good workforce, but I don't think they will be working for Cammell Laird."

Gerry Hunter, regional officer with the Amalgamated Electrical and Engineering Union (AEEU), added: "This is a hammer blow to British shipbuilding. Manufacturing in the UK is under tremendous pressure and something must be done to stem the tide."

Tim James, Tyneside area manager for the North-East Chamber of Commerce, said: "The knock-on effect is unfortunately going to be felt outside the region's yards, making the blow much harder."

He added: "Rescue packages have been put together for other yards in the past, so we must remain optimistic."

Redcar MP Mo Mowlam said: "The Government has been in contact with the receiver to see what we can do to help find a buyer.