The transaction was announced yesterday by Geoff Parker, the former chief executive of Bruck Textiles, who will now take on the same role at Australian Textile Mills.

Mr Parker said the sale would offer the company long-term security for the remaining 120 workers.

He said the plant, which had specialised in supplying textiles to industries including automotive and defence since 1947, had become “squeezed into unprofitability” following major downturns in the market.

Workers were called into a meeting yesterday where they were told the company had been placed into liquidation.

They were then told to leave the site and later met a liquidator who handed out 60 termination notices.

National secretary with the Textile, Clothing and Footwear Union Michele O’Neil said the announcement was a “devastating blow for those workers and their families”.

“We are extremely concerned about how this has happened,” she said.

“They were told there was no money in Bruck Textiles to pay their entitlements and they would have to apply to Fair Entitlements Guarantee.”

EDITORIAL: Worker's must get every cent

- Workers encouraged to apply for Fair Entitlements Guarantee assistance as soon as possible

Ms O’Neil said the announcement coincided with the release of unemployment rates that showed “some of the worst figures in years”.

Indi MP Cathy McGowan and member for Murray Valley Tim McCurdy called on government support yesterday after expressing their sympathy for the terminated workers.

“My thoughts are with the workers and families at this tough and stressful time,” she said.

“These workers will be wondering how they are going to support their families and live, and keep a roof over their heads.”

The members of Parliament called an emergency meeting with the company where Australian Textile Mills announced a hardship fund for retrenched workers.

Australian Textile Mills, which will invest $8 million into the business, is still to finalise the details of the fund.

Ms McGowan contacted Minister for Industry, Ian Macfarlane, to ask for swift government action through the government safety net scheme for an estimated $3.8 million entitlements owing.

“The Fair Entitlements Guarantee was implemented for this situation and I call on the government to fast-track applications to receive owed outstanding entitlements,” she said.

Mr McCurdy said while it was not a good news day, there was some light at the end of the tunnel.

“This new entity going forward is sustainable,” he said.

“The 120 jobs will remain and these workers have a secure job well into the future.”

Mr Parker said the purchase was necessary but said the company was confident heading into the future.

“Over the past two years, manufacturers and suppliers to the Australian automotive industry and Australian Defence Forces experienced a downturn in demand,” Mr Parker said.

“The latest indicators suggest a further dramatic downturn, while overhead costs, and imposts such as energy costs, continue to rise.

“Moving forward, Australian Textile Mills has implemented an aggressive marketing and business development plan to augment existing orders.”

The Textile, Clothing and Footwear Union will meet its members on Monday morning, followed by a meeting with the company.