Leading writers Germaine Greer and Jim Crace have cancelled their appearances at the Hay-on-Wye literary festival after they discovered Swiss food giant Nestlé is a key sponsor.

Concern over Nestlé's marketing of powdered infant formula in developing countries has prompted the two authors to quit the festival, which was described as "the Woodstock of the Mind" by former US president Bill Clinton, who has spoken at the festival.

Greer said she did not immediately withdraw when she learned of Nestlé's involvement, as she "was being told on all sides that Nestlé has cleaned up its act But after 40 years of irresponsibility I doubted this, so I had a look at the World Health Organisation pronouncements which Nestlé claims exonerates it - but they don't. Nestlé is trying to look caring and sharing but I don't think it predicted the flak it would get."

Festival organiser Peter Florence commented: "We always consider sponsorship carefully as indeed we did with Nestlé and we came to a different conclusion from Germaine."

A Nestlé spokesman said its marketing of infant formula in the developing world was in line with the WHO code. He is reported in the Daily Telegraph as saying: "There have been a lot of changes to our marketing practices and the accusations are years out of date."