The managing director of Shropshire’s failed Merrythought teddy bear factory today offered to lend his own money to help out redundant staff at Christmas.  

Oliver Holmes said each of his 48 employees – thrown out of work last week – could have an interest-free loan of up to £250, because many of them will be in “dire straits” at Christmas.

He said the cash would come from his holding company Merrythought Ltd, or from his own pocket if necessary.

It follows the announcement on November 27 that the 76-year-old family firm at Ironbridge was ceasing production immediately due to cheap competition from abroad and declining interest in collecting specialist bears.  

The insolvent manufacturing company, Merrythought Toys, is due to be formally placed into liquidation at a creditors’ meeting on December 14.

But until that happens, the 48 staff, most of them women with families, are not entitled to receive outstanding wages, holiday pay, payments in lieu of notice or redundancy pay.

Mr Holmes said today many of his former employees were in “dire straits” on £60-a-week Jobseekers’ Allowance.

“I haven’t been able to sleep at night,” he said.

“They’ve been left high and dry and I’m mortified at their plight.

“We were a family more than a company and I’m determined to help them in the run-up to Christmas.”

Mr Holmes said he would hand out loans to a maximum of £12,000, either through his holding company Merrythought, which is solvent, or from his personal finances.

“I’m writing to all staff today, offering them up to £250 each with no strings attached, apart from a simple IOU,” he said.

Insolvency specialist Caroline Smith, of Heathcote & Coleman, who is advising Mr Holmes, said he was legally entitled to make loans from his holding company or own pocket.

Claims for money owed by Merrythought Toys have been completed for all 48 staff for hand delivery to the Department of Trade and Industry when the liquidation resolution is passed

By Peter Johnson