UP to 35 jobs have been saved with the sell-off of the final part of the stricken Blackburn-based Vernon Stainless group.

Administrators KPMG said Vernon's Loks Plasma division had been sold to Metals UK Group Ltd for an undisclosed sum. A spokesman said the deal had saved the jobs of the majority of the employees at the division's site at Lower Philips Road, on the Whitebirk Industrial Estate.

Troubled steel stockholders Vernon Stainless was taken over last week, just hours after going into administration, by Leeds-based ASD plc which has promised to continue the Blackburn operations which will now be known as KMS Vernon.

Loks Plasma, which boasts the largest capacity for stainless steel profiling in the UK, was not part of that deal and the administrators were forced to look for another buyer.

Joint administrative receiver Paul Flint said: "I am delighted that we were able to reach agreement with Metals UK Group, which had been interested in the Loks Plasma business since we were first appointed as administrators to Vernon Stainless.

"It is always very satisfying to see any business survive, particularly when it involves local manufacturing."

Ian Griffiths, group managing director of Bolton-based Metals UK Group Ltd, said: "This acquisition establishes the group as the largest processor of stainless steel plate in the UK."

ASD chief executive Martin Joyce said Vernon Stainless had been in severe financial difficulty for some time.

"They had serious cash-flow problems and had been haemorrhaging cash," he said. "They had gone into administration and the only other offer on the table would have involved the loss of all the jobs."

Mr Joyce said ASD's takeover would save 90 jobs in Blackburn, but staff have been told that up to 30 jobs would have to go to reduce overheads.

Loks, which employed 35 people, produces profiles in both stainless steel and other materials, largely for the construction industry.

News of the financial troubles at Vernon Stainless came just a week after Corus announced it was pulling out of the former Walkersteel site at Guide with the loss of more than 50 jobs.

The company - formerly British Steel - plans to close its present complex by summer next year and relocate its Multi Products business to a recently-refurbished unit on Walker Park.

Vernon Stainless was formed in 1989 and grew into one of the UK's leading independent stockholder and processor of stainless steel.