THE UK company at the heart of an arms dealer's extradition to America could go into liquidation within weeks.

Guy Savage was seized in a dramatic raid by armed police who shot out the tyres of his Mercedes as it pulled out of sleepy Pinner cul-de-sac Daymer Gardens, where he lives, on February 8.

He is accused of breaching regulations in America on the export of M16 assault rifles and silencers to the UK, but through his lawyer he denied being involved in “clandestine smuggling” at City of Westminster Magistrates Court last week.

Prosecutors said the charges related to the business activities of Sabre Defence Industries Ltd, which has a weapons factory in Belvue Road, Northolt, where police say they seized more than 500 guns at the time of Mr Savage's arrest.

The Harrow Times has learned insolvency company B&C Associates has already been called in and a meeting with creditors has been arranged for March 14, when it is expected to go into liquidation.

Nitin Joshi, of B&C Associates, said Mr Savage appeared “very passionate about his business, very technically minded.”

He said several companies interested in buying Sabre had already emerged.

He said: “Sabre has significant value to the right business in the sector. It has a well established customer base. It is extremely well known and has a reasonable reputation.”

He added: “I deal with hundreds of liquidations but this one is certainly more interesting than most.”

The warehouse is said to contain vast and highly expensive machinery for the production of firearms, but most of the equipment is not fully owned by Mr Savage and requires payments.

Sabre UK is said to have had cash flow problems leaving it facing up to £400,000 of debt, mainly to family members of Mr Savage.

B&C Associates have only been given access to the Northolt site in the last few days and have not had a chance to fully value the company's assets.

Sabre company accounts dated November 2009 put its assets at the time at around £1.5m.

Seth Levine, on behalf of Mr Savage, told the court last week: “He's a properly licenced trader in arms. He was entitled to be exporting and importing items like these.

“There's no suggestion that the end users were anything other than appropriate end users. There's no suggestion that he was engaged in the clandestine smuggling of arms that could end up in nefarious hands.”