Owners of the Sonae plant in Knowsley are now in negotiations with employees and trade unions with 220 jobs at risk.
Sonae Industria (UK) has been in the headlines for the wrong reasons after two maintenance workers died in a giant silo at the plant in December 2010.
The factory was also hot by a major fire last year and a demolition worker died during work to tear-down parts of the building ruined by the blaze.
A statement from Sonae said the company would “enter into consultations with employee and trade union representatives regarding the future of its operations in Knowsley, Merseyside.”
It added: “220 people work at the Particle Board plant, which has been based at Knowsley Industrial Park for 12 years and has a production capacity of 500,000 m3 per annum.
“There have been long delays to the reconstruction programme of the plant due to the difficulties in obtaining the necessary planning approvals, following the fire that occurred in June 2011.
“This coupled with the current economic climate and the downturn in the construction industry, have affected the viability of this plant. It is therefore necessary to reconsider future options.
“It is Sonae Indústria’s intention to continue supplying the UK market.”