Confectionery group Cloetta has put forward plans to close a factory in the Dutch town of Dieren by the end of 2016.
The company said the decision follows an evaluation of the synergies it can achieve following its acquisition of fudge maker Locawo, which produces confectionery under the Lonka brand.
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“The closure of the factory in Dieren, in-sourcing of production and synergies in administration, sales and procurement from the acquisition of Lonka will generate savings of at least SEK35m on an annual basis,” Cloetta said today (20 November).
Cloetta expects savings to have a “gradual effect” in 2016 and 2017, contributing to the group’s targeted operating margin of 14%. The full run-rate of the savings will materialise in 2018. The closure will give rise to one-off costs and capital investments totalling approximately SEK120m, the bulk of which will fall in fiscal 2016.
A total of 34 people are employed at the Dieren site. The company said it will start consultations with the local works council and the European Works Council.
Cloetta plans to transfer production to its facility in Levice, Slovakia, which will be extended as part of the transfer.
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