BUSINESS confidence in Darlington is continuing to grow, despite the national economic challenges in the wake of Hurricane Katrina's impact on the US.

The positive outlook was supported by the recent launch of a promotional CD-ROM.

That initiative was partly-funded through a £1m legacy left by British American Tobacco, which closed its Rothmans factory two years ago with the loss of 500 jobs.

However, Clive Owen, senior partner at Clive Owen and Co LLP chartered accountants and business advisors, said business in the town was not following the national trend.

He said: "At a time when the construction industry is booming, with massive house building programmes, investment in new business parks and significant public sector spending on major construction projects in the region, the Construction Industry Training Board has announced some worrying figures.

"The figures, which show a 22 per cent growth in construction output in the North-East over the past two years, also point towards a shortage in workers equivalent to 10,000 people.

"The organisation believes the problem could be the result of difficulties in attracting young people into the industry and the migration of skilled northern tradesmen to the south, attracted by better prospects."

But, construction company MMP Construction (NE), a division of Newton Aycliffe's MMP Group, is bucking the trend.

It recently won a contract to build a sixth form and make alterations to St Leonard's School, in Durham.

The group has seen considerable success over the past year, expanding its four divisions to six, to include joinery and shopfitting, plastering and drylining, and finishings.

Other business news this month has centred on van hire firm Northgate Plc.

Mr Owen said: "It is rumoured that the business, which last month reported a 24 per cent increase in pre-tax profits to £55.6m in the year to April 30, with turnover up 29 per cent to £458m, has received a bid of £800m from financier Guy Hands and his investment company, Terra Firma.

"Northgate, which was founded by Alan Noble in 1981, has seen significant expansion into Spain with its acquisition of Spanish vehicle hire company, Fualsa, and its 49 per cent stake in another Spanish hire company, Record Rent.

"Such is the company's success that the price being offered by Mr Hands may undervalue its potential.

"It will be interesting to see how this prominent Darlington business, which employs 350 in the town will react to the bid."