A consultation with union representatives, management and production staff at risk began late last week at Uniq’s factory in Minsterley, with the firm giving employees the option of voluntary redundancy, although a spokeswoman confirmed to FoodManufacture.co.uk that alternative roles within the group might also be available.
Significant business loss
Minsterley Md Steve Hill said: “We have been aware for some time that we were due to lose significant amount of business to our competitors in April and have been exploring a number of opportunities to try and secure additional volume to replace it.
Uniq’s failure to make up for the lost business volumes left it with no choice, Hill said, adding that the 85 potential redundancies were consistent with cost savings “we need to make in order to secure the long term future of the site”.
Admitting that the announcement would cause concern and uncertainty for Minsterley staff, he said: “Our main priority now will be to work with those employees ... to try and lessen the potential impact of the proposed redundancies, and where necessary, help them secure alternative employment.”
Recent site upheaval
The £100m turnover factory at Minsterley in Shropshire employs around 780 staff and makes chocolate products, desserts and yogurts, but has seen a lot of upheaval in recent years, absorbing production from Uniq’s Paignton desserts factory and adjusting to new kit and working patterns.
One City analyst, who wished to remain anonymous, told FoodManufacture.co.uk this morning: "At the last trading update we trimmed forecasts slightly, because of the desserts business contract loss", while at that point issues hadn't been resolved relating to the pension deal, they added.
"In the trading update prior to that Uniq reported that the sandwich business was trading well, although desserts are still under review." The analyst said that they thought Minsterley was "still not trading at its full potential" , even after Uniq pumped £10m into this site and a facility at Evercreech last spring, consolidating production at these locations after closing its Paignton desserts plant in November 2009.
Progress made at Minsterley
Announcing news of the contract loss news in late January, Uniq chief executive Geoff Eaton (pictured) said: “I’m obviously disappointed by the loss of business, but we have also made a lot of progress at Minsterley.
“We had a very successful product launch in summer last year on the back of a tremendous amount of investment in consumer needs and in kit, but then the cream price doubled and we had to put prices up, and it has caused a lot of disruption in the market. As a consequence of that, we are still making losses in desserts.”
On Monday the High Court sanctioned Uniq's novel 'pension deficit for equity swap', whereby the pension fund will be handed 90% of the convenience food group's shares as a result of waiving its £400m+ pension fund liability.