The Government has ruled out any last attempt to save more than 600 jobs at Irish Fertilizer Industries in Cork, Arklow and Belfast.
The Tánaiste, Ms Harney, last night said the Government and its co-shareholder - the British chemicals giant Imperial Chemical Industries - would move to wind up the company on foot of a recommendation from its board that a liquidator be appointed.
The group's 620 workers were informed yesterday that the company was to close. The announcement comes just one month after cost-cutting proposals aimed at saving the group were put to Ms Harney.
Ms Harney said that considerable efforts by the company to devise a business plan had not succeeded.
The State and ICI, joint owners of IFI, would now co-operate with the liquidator "to ensure that the process can be as smooth and as efficient as possible".
The company is 51 per cent State-owned with the remaining 49 per cent interest held by ICI. It has been hit by a slump in the European fertiliser market in recent years and, after losing over €30 million in the year to September 2002, is no longer considered viable.
ICI has struggled since its inception in 1987 and in recent years has required substantial borrowings just to fund day to day operating costs.
Last night, sources at the group said IFI's complex operating structure was seen by workers as being responsible for its financial difficulties.
IFI imports gas via Scotland to its Marino Point plant in Cork where ammonia is produced. The ammonia is then transported to its two other plants in Arklow, Co Wicklow, and Belfast where it is used to make fertiliser.
However, that process is costly and IFI could have realised substantial savings by simply importing ammonia from abroad rather than producing it in Ireland.
Ms Harney said last night that it was €50 a tonne cheaper to import fertiliser than to manufacture it in Ireland. It is understood the Government has hoped to sell the Belfast and Arklow operations to a buyer who would import ammonia. However, with the company running up increased debts on a daily basis, it simply ran out of time.
The final decision to close the plant was agreed upon at a board meeting yesterday. A statement from the company last night said Europe now had a glut of fertiliser and falling demand. The decision to recommend the closure of the company had been taken "with great regret" and only after "exhaustive consideration of all possibilities".
The wind-down of all three plants will begin immediately. It is hoped that significant elements of IFI's business will be sold by the liquidator.
However, a spokesman for Fine Gael, Mr Phil Hogan, claimed the closure was related to "rampant cost increases in the economy" which the Government and the Tánaiste had allowed to escalate.
"This is a further indication that the Government did not intervene early enough to minimise the job losses and of the Tánaiste's obvious failure to convince anybody that part of the company, at least, could survive," he said.
Mr Tommy Broughan of the Labour Party called on the Tánaiste to reject the request for liquidation of the IFI board and to open discussions aimed at keeping the plant open.
"It will be extremely difficult for those laid off today to acquire alternative employment," he said.
Ms Harney said her first concern was to ensure that "everything possible be done to assist those concerned to find alternative employment as quickly as possible.
"In particular I have spoken with FÁS who will immediately look at the needs of the workforce in both Cork and Arklow with the priority being to provide whatever retraining might be necessary."