Communisis: 'Devastating blow' as 638 jobs lost from major Leeds business going into administration

The integrated marketing services company, which provided print and mailing services for the UK's largest financial and public institutions, employed more than 1,000 people around the UK and over 200 overseas.

While its Brand Deployment business has been sold to Paragon Customer Communications as part of the administration process, safeguarding 581 jobs, administrators said that 638 workers have lost their jobs as other operations are stopped.

A total of 256 jobs have been lost in Leeds, 196 in Liverpool, 37 in Cramlington and seven in Copley. A further 142 remote workers have also been made redundant.

Stephen Absolom, managing director at Interpath Advisory and joint administrator, said: “First and foremost, we recognise that this will come as a devastating blow to those Communisis workers who have been impacted by redundancy.

“Our immediate priority will be to work with all affected employees to ensure that the full range of support is available to them.

“We will be making contact with Communisis’ key competitors, customers and other companies who work in this space to enquire around possible employment opportunities for staff.

"We will collate all relevant information, including contact details such as telephone numbers and hotlines, and we will also be speaking as a matter of urgency with the Job Centre Rapid Response Unit.

“We are also liaising with the Insolvency Service in relation to the timing of redundancy payments via the Redundancy Payments Service.”

The company’s Customer Experience (CE) business had delivered around 700 million information packs and 1.3 billion pages per annum to consumers sent on behalf of financial and public institutions.

Administrators said the group and the CE business in particular “had been experiencing challenging trading conditions for some time”.

A spokesperson said: “The printing sector as a whole is witnessing inexorably declining volumes in the wake of the emergence of digital technologies, while the costs of production – including rising energy prices and the cost of paper – has also hit some companies across the sector hard.

“A digital transformation programme which sought to improve Communisis’ legacy technology platforms proved to be more complex and costly than originally forecast. In addition, in October 2023, the Companies’ U.S. parent, OSG Group, announced it was to enter a Chapter 11 restructuring process which, once complete, would see Communisis Limited exit the OSG Group. Communisis’ financial pressures were then further exacerbated by the loss of a number of customer contracts which resulted in excess capacity at certain of its sites.

“Over recent months, the group has worked closely with its advisors, customers and stakeholders to explore a number of options which would enable the CE business to move forward on a more sustainable footing, including exploring options around a whole or partial sale. When it became clear that a solvent solution could not be found for CE, the directors took the difficult decision to seek the appointment of administrators.”

The sale of the Brand Deployment business to Paragon includes the agencies Twelve and Editions and the point of purchase specialist, Vox Group.

The deal will also see Paragon take over the delivery of services for Lloyds Banking Group, involving the management of over 100 million communications to and from the bank’s customers annually. This work was previously part of the CE business’s remit.

James Clark, managing director at Interpath Advisory and joint administrator added, “The transaction with Paragon enables the historically profitable Brand Deployment business to move forward under new ownership, as well as ensuring the continuity of service to Lloyds Banking Group.

“The complexity of the Communisis business means that this transaction is the culmination of many months of hard work from a wide range of stakeholders. We’d like to thank each of them, in particular the Communisis workforce who have maintained service levels to customers under extremely challenging circumstances. In addition, the support and efforts of the Communisis’ customers, suppliers, as well as the Pensions Trustees and regulatory bodies, have ultimately enabled this agreement with Paragon to be reached today.”