NEWPORT defence contractor Atlas Elektronik UK has announced it is to close, citing reduced demand and high costs associated with the site for the closure.
It is understood the company, which is based at Queensway Meadows, will close the site by mid 2014.
The firm, which employs 49 people, says it is trying to minimise the number of compulsory redundancies by working with a staff consultative committee to discuss possible relocation to the company's Dorset site, which will remain open.
Atlas Elektronik GmbH, the parent company of Atlas Elektronik UK, is a global defence group and a world leader in the provision of naval combat systems, maritime systems and equipment.
The company is involved in the development of integrated sonar systems for submarines and heavyweight torpedoes, and supplies naval defence and security research and advice to the MOD.
Phil Cooper, business development director for Atlas Elektronik said: "The Atlas Elektronik business has been operating from its current Queensway Meadows site in Newport since 1993.
"Unfortunately the company has reluctantly decided that it will not extend the lease on this site when it runs out in June 2014. "Some elements of the Newport business will be retained and transferred to the Atlas Elektonik facility at Winfrith in Dorset.
"The decision to exit the Queensway Meadows site has been taken with a good deal of consideration and regret, but has been driven by the high cost base associated with the site and the reducing demand for some product lines.
"We have been in discussion with both our customers and staff over this matter for a number of months. We are working closely with our staff consultative committee to maximise the opportunities for our Newport-based staff through possible relocation to Dorset or options for flexible working "Additionally, we are working closely with local employment agencies to find alternative job opportunities for staff we cannot relocate. The Newport site currently employs 49 staff and our objective is to minimise the number of compulsory redundancies."
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