THE future of body armour specialist Shieldtech remained in the balance last night after a potential bidder's period of exclusivity ended.

The Warrington company, which is listed on the Alternative Investment Market (AIM), appointed administrators on October 20 after having severe cashflow problems.

Gareth Roberts and Paul Ellison of RSM Tenon Recovery in Reading were appointed joint administrators and immediately made more than 60 staff at Shieldtech, and its subsidiary Aegis Engineering, redundant.

Its shares had been suspended on AIM two days earlier.

A £1.1m debenture was held by Bruce Gordon, Stephen Jenkins and Derek James, while HSBC Bank also holds two debentures. Mr Gordon is the founder of Reading-based Thames Valley Capital and is understood to have been in talks last week to purchase the assets of Shieldtech.

The administrators had also received expressions of interest from at least two other parties

Previous negotiations before the company went into administration with HSBC, the loan note holders and investors, failed to reach a "satisfactory conclusion". Its woes were compounded when its bank placed proceeds of a recent Turkish contract into an escrow account as security for its loan, which hit its working capital.

The group supplies body armour to soldiers in Afghanistan and 25 police forces in the UK.

Aegis Engineering was appointed as preferred supplier to at least 30 of the 53 UK police forces earlier this year under a national framework agreement. However, none of the series of mini-tenders under the agreement have been completed and the timing of orders "remains uncertain".

The group made a pre-tax loss of £82,000 in the six months to December, 2009, having made a £92,000 profit in the last financial year. However this followed a £10.3m loss in the year to June, 2008.