HYNDBURN’S largest and oldest textile company has become the latest victim of the credit crunch by announcing it has gone into administration.

Family-run Hilden Manufacturing, based at Clifton Mill in Pickup Street, Accrington, was established in 1874 by the family descended from textile pioneer James Hargreaves, inventor of the Spinning Jenny.

The company, which has an annual turnover of £15M, employs 80 workers and is continuing to trade while administrators Ernst and Young try to sell it as a going concern.

Hilden, once a world leader, is an importer and finisher of bed, table and bathroom linen for hotels, restaurants, councils and health authorities.

It is understood the business suffered a sharp downturn in sales in the first three months of this year, and although trade has since improved it has run out of cash.

Ernst and Young partner and joint administrator Tom Jack said: "We are grateful for the continued support of the company’s customers, suppliers and employees as we assess the situation at this early stage. We are already aware of strong interest in the company as we explore a sale of the business and assets as a going concern."

A visibly-upset employee, who did not want to be named, told the Observer: "Some of the women have been there for 30 years and everybody is devastated."

The Hilden Group is the parent company of giant retail complex Oswaldtwistle Mills which is unaffected.

Boyd Hargreaves, the Hilden Group’s director, said: "I hope that interested parties will take the company out of administration very quickly and safeguard all the jobs."

Since 2000 the company has downsized with over 100 job losses in 2004 when it switched its manufacturing base to Egypt.

The company’s Accrington-based Woodnook Mill lost 46 jobs and its Blackburn factory, Britannia Mill, suffered 64 redundancies.

This week’s news follows a series of shock job losses as the downturn tightens its grip on Hyndburn. They include 260 jobs at Thomas Cook's Accrington call centre and 80 jobs at Oswald-twistle-based gardening suppliers Joseph Metcalf.