HUNDREDS of staff at the Hampshire branch of a major tobacco supplier have lost their jobs.

A total of 229 staff have been made redundant at two Palmer & Harvey sites in Fareham after it collapsed into administration, despite attempts to secure a lifeline for the troubled wholesaler.

It puts 2,500 staff out of work nationally.

The company employs 266 people at two sites, on Barnes Wallis Road and Crompton Way in Segensworth.

Staff working at the Segensworth plants were called into an emergency meeting at 4.30pm yesterday to be told by senior managers that 'as of this moment, Palmer and Harvey were in administration and consequently 'the majority of staff would be made redundant immediately'.

The move has shocked employees and union leaders.

Talking to the Daily Echo anonymously, one employee said: "When we were called into the meeting at 4.30pm yesterday afternoon where we found out that we had lost our jobs, I was left shocked and devastated."

Another employee, Brian Stretham, who worked at the company for two years said: "To be made redundant just before Christmas is simply awful.

"Our jobs have just gone without any warning at all."

Mark Todd, national officer of the Union of Shop, Distributive and Allied Workers (Usdaw), said: "Usdaw is deeply concerned at the devastating news that Palmer & Harvey has gone into administration and that a significant number of redundancies have already been announced.

"The union is seeking an urgent meeting with the administrators to clarify what is going on and the implications for Usdaw members.

"Today's announcement is a massive shock to our members and is an extremely distressing situation for all concerned, especially in the run up to Christmas.

"We will of course be doing everything possible to protect our members' interests going forward."

The 90-year-old firm has appointed PwC as administrators after “challenging trading conditions” heaped pressure on its cash flow and efforts to revive the business failed.

Palmer and Harvey entered takeover talks with the Carlyle Group in October, but the US private equity fund’s offer of a capital investment in exchange for a controlling stake did not progress.

Palmer and Harvey, the UK’s biggest supplier of cigarettes, employs a total of 3,400 people and also provides alcohol, groceries and frozen food to 90,000 retail accounts, including Tesco.

Matthew Callaghan, joint administrator and PwC partner, said: “This is a devastating blow for everyone who has been involved in the business.

“The administration team will focus on working with employees, clients and suppliers to facilitate a smooth and effective wind-down or transfer of operations over the next few weeks.

“The company has insufficient cash resources to continue to trade beyond the short term and the directors have concluded that there is no longer any reasonable prospect of a sale.

“Therefore, the directors have had no choice but appoint administrators.”

Councillor Sean Woodward, leader of Fareham Borough Council said: “Hundreds of loyal workers are now in danger of losing their jobs.

“We would regard this as a major economic shock to south Hampshire.

“I will be discussing it with my Solent LEP colleagues to see what help we can put in place to support anyone losing their jobs.

“I will be discussing it with my Solent LEP colleagues to see what help we can put in place to support anyone losing their jobs."

Councillor Geoff Hockley, county councillor for Titchfield added: "I am saddened by the news and I hope that the people affected will be able to find new jobs."