The mailing and finishing company, which has sites in Plymouth and Roche, had several big-name magazine publishing customers including VNU Business Publications, Haymarket and Cond Nast.

Industry rumours suggested that St Ives was the most likely buyer for Ailec, which handles a lot of work for St Ives' web operations in Plymouth and Roche. But those claims were rebuffed by a source at St Ives who said: "It is just speculation at the moment."

According to administrative receivers Neville Hatton & Co, Ailec's move was due to "cost escalations because of the minimum wage, business rates and energy costs". This made it "problematic for Ailec to make profits".

"There are a number of people looking to acquire the business," added administrative receiver Richard Neville. "All I can say is that those people are serious."

He added that Ailec's 300-strong workforce would remain and will be carrying on with a "full order book".

VNU Business Publications production director Joanne Hurst said: "Ailec have been among the best magazine finishers and mailing houses in the UK. We'll be sorry to see them go."

Ailec's kit includes six Buhrs Zaandam wrapping lines and Domino ink-jet machines. Its services include inserts, cover mounting, wrapping, bagging and final labelling.

Ailec was shortlisted for a PPA Magazine Production Award in 2002 for Best Magazine Finishing.

Views from the industry
"It is a contradiction in that Ailec was so busy with orders but has now gone into administrative receivership" Haymarket group production director Chris King

"It's a very sad day for the industry" VNU Business Publications production director Joanne Hurst

Story by Philip Chadwick