A SOUTHAMPTON yacht builder struggling for survival said it "ran out of cash".

Oyster Yachts, based at Saxon Wharf in Northam, has gone under with the likely loss of 160 Southampton jobs and 400 across all its sites.

The Oyster Group comprises Oyster Marine Ltd, Oyster Brokerage Ltd and Southampton Yacht Services Ltd. The firm has offices in Ipswich, Wroxam in Norfolk, Mallorca and Newport, Rhode Island.

The news sent shock waves through the yachting world as the firm seemed to be riding high having just launched the Oyster 745 at the Dusseldorf boat show last month. The 745 had been named

2018 Best Luxury Cruiser by the US magazine Cruising World.

Yesterday Oyster’s website also still carried an announcement that it had ended 2017 with a record orders amounting to more than £80 million.

On January 10, chief executive David Tydeman said: “We closed the year with an £80m+ order-book of 25 yachts ranging from Oyster 475-07 to 118-02, securing a positive outlook for 2018 and 2019.”

However on Tuesday Mr Tydeman, released the following statement on their website: “It is with sincere regret that we advise that the company has been unable to secure financial support to enable it to continue at this time and it is looking at all opportunities available. Further information will be issued as soon as we can.”

Mr Tydeman told SuperyachtNews.com: “We are not in administration at the moment and we are not in liquidation. Yesterday, however, we did start a consultation with all staff about potential redundancy, because we do not have the means to pay them at the moment.”

A letter, signed by Ben Collett on behalf of Oyster Marine Limited, was sent out on Monday to members of staff saying that the company “has been unable to secure financial support to enable it to continue to trade at this time and it is now facing entering into an insolvency procedure imminently. After considering all possible options, the company has concluded that there is a risk that it will be unable to continue to provide work for all its employees at all locations and that it is likely that it will have to make all of its employees redundant. The company has run out of cash and is unable to pay employees for work. The company has decided to close all operations today (and for the immediate future) to prevent or minimise all loss to employees and all other creditors.”

Dutch investment firm HTP Investments are rumoured to have withdrawn financial support for the company.

HTP Investments BV bought the company, founded in 1973, for just under £15 million in 2012 from Balmoral Capital who had bought the firm four years before for substantially more — £70m – from its founder Richard Matthews.

Industry sources suggest that Oyster may have lost large sums dealing with structural defects identified following the loss of Oyster yacht Polina Star III, which lost her keel and sank off the coast of Spain in 2015.

The yacht was recovered from the seabed and Oyster had since been working with independent experts and the owners’ insurance company to examine the wreck.

The loss of the Polinar Star III resulted in a loss of £5.2 million in 2015 according to the firm’s annual report after it had made a profit of £1.4m in 2014.

In 2015 the firm also invested in a new head office in Southampton.

Yacht designer Rob Humphreys, from Everton near Lymington, worked for many years with Oyster.

His firm had designed more than 20 models for the firm and was working on the new 565, due to be launched this year.

He said that Oyster already had six orders for the yachts which came with a price tag of more than £1 million.

Mr Humphreys said he had no inkling Oyster was in trouble.

“This was a real shock. It’s very depressing for that incredible workforce in Southampton.”

He said Oyster was well regarded within the yachting sector. “They were respectable and respectful and they offered their customers an after-sales service which was the envy of the industry,” said the designer.

Southampton Itchen MP Royston Smith said he was “shocked and disappointed” by the news.

“Oyster company the city could be proud and which seemed to be sound,” he said.

“This means the loss of high value skilled jobs of the type were are trying to get more of.”