PoleStar Foods axes 232 jobs at Okehampton factory

PoleStar Foods was formed in December 2009 following the acquisition of Heinz’s UK frozen desserts business but ran into serious financial difficulties within months of the acquisition.

Things came to a head last November when Privet Capital stepped in to prevent PoleStar's immediate collapse and said it could secure the future of its factory in Okehampton but not the factory at Leamington Spa, which has just closed with the loss of more than 160 jobs.

However, just two months after staff at Okehampton were told there jobs were secure, bosses have made 232 workers redundant with immediate effect.​​A further 14 staff have been retained to maintain the production facilities in the event that a buyer is found.

Unforeseen problems​

A spokeswoman said: "Despite exhaustive efforts to keep the Okehampton factory operational, we have encountered unforeseen problems and very regrettably have been forced to make 232 staff redundant with immediate effect. ​
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"We have held constructive meetings with staff and union officials today and realise that this is very unsettling for all those involved. It is possible that an administrator will be appointed by the company in the coming days. ​

"We are working towards an outcome where a buyer can be found for the operation in the hope that some staff can be re-employed under new ownership. There cannot be any guarantees but this is what we are working very hard towards."​

Staff have not been paid​

FoodManufacture.co.uk was first alerted to the fresh problems at Okehampton last week when staff contacted this publication claiming that they had not been paid. Production also stopped at the end of last week.

A source close to the firm, which makes own-label desserts for the supermarkets, said: "This is a very unusual scenario. Clearly when a finance company comes in to take on a business as a going concern you don't expect things to go wrong this fast."​

Privet Capital declined to comment but FoodManufacture.co.uk understands that the firm had problems with lending facilities put in place ahead of the acquisition.

Leamington Spa auction​

Separately, Country Style Foods boss Tony Wood declined to comment on rumours that his firm had been looking at the equipment in PoleStar's Leamington Spa factory, ​the contents of which are being sold by administrator KPMG.