The Welsh Development Agency has said it is hoping to replace more than 100 jobs being lost with the sudden closure of a mid Wales factory.
More than 100 people have lost their jobs in Llandrindod Wells
The agency said it would be actively marketing the site occupied by Mid Wales Yarns in Llandrindod Wells. The company announced on Thursday it would be closing.
On Saturday it emerged that the WDA was trying to identify potential investors to take over production at the textiles plant.
The firm, owned by Fred Lawton and Son of Yorkshire, spins yarn for the carpet industry.
Llandrindod Wells has the highest unemployment rate in Powys and the county council has said closure of the Yarns plant will come as a major blow to its efforts to regenerate the area's economy.
The closure announcement shocked officials in the town who said they were astonished as there had been no indication of the company's intentions.
Powys County Council, which has been working to regenerate Llandrindod Wells, said the job losses were a 'setback.'
A spokesman added: "We're surprised and disappointed. We've been helping to regenerate the town."
A spokesman for Llandrindod Wells Town Council said the job losses were a 'huge blow' to the town.
"We are very disappointed and we thought the company was doing quite well," he said.
"But the company was taken over a few months ago and seemed to have a high turnover of staff.
"From what I understand the company has gone into receivership.
"The knock-on effects from this will be huge and the impact will be felt for miles around. We don't have a great deal of work available in the town and area and this has undoubtedly added to the problem."
The council added that the vast majority of workers had already left the factory and equipment was being removed.