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City Link administrators announce 2,356 job losses

 The administrators of collapsed delivery firm City Link have announced 2,356 job losses after a bid to buy the company failed.

The administrators, who took over City Link on Christmas Eve, said an unnamed consortium's offer was not acceptable.

The possible buyer "offered no money up front and significantly undervalued the assets to be acquired," they said.

Mick Cash, general secretary of the RMT union, said the City Link collapse "shames our nation".

The Coventry-based company employed 2,727 people, but suffered years of losses.

Just over 370 City Link staff have been kept on to deal with the parcels that remain at depots and help run down the business.

The administrators, from Ernst & Young, said they had proposed alternative purchase terms to the consortium "that would be acceptable and common in these situations. The consortium, despite attempts to make them reconsider, declined to amend their original offer".

Speculation about a potential rescue deal emerged earlier on Wednesday when Mr Cash disclosed that he had been told of "a credible bid to take over some or all of the City Link trading operations".

Following confirmation that the rescue had failed, Mr Cash said: "Pulling the plug on any efforts to save City Link is a disgraceful and cynical betrayal that will wreck the lives of our members, many of whom are owed thousands of pounds."

The mass redundancies would leaving a "trail of human misery", he said, adding: "Those responsible will slink away with their own resources ring fenced and leaving the taxpayer to pick up the redundancy tab.

"The City Link Christmas destruction is an act of industrial vandalism that shames our nation while the government looked on and offered nothing but hollow words."

'No alternative'

The manner and timing of City Link's collapse have been criticised, including by two Conservative MPs.

One, former minister Damian Green, said: "The whole business has been handled very badly."

On Monday, Jon Moulton, founder of Better Capital, the investment firm which owned City Link, apologised for the impact on staff but said there was no alternative but to put the loss-making business into administration.

Hunter Kelly, one of the administrators, said in a statement on Wednesday: "It is with regret that we have to announce substantial redundancies at City Link Limited, which ceased accepting new parcels on 24 December 2014.

"The company endured substantial losses, which ultimately became too great for it to continue as a going concern, and City Link Limited entered administration following an unsuccessful sale process."

City Link was founded in 1969, and was bought by Better Capital for just £1 in April 2013.

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