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US ice cream company Dreyer's has announced it will close a plant in Union City, California, which produces packaged and bulk ice cream and frozen desserts.

The news affects some 221 workers who are employed at the plant, although Dreyer's hopes to offer around a third of these alternative employment. The closure will take place in the first quarter of next year.

Production capacity in Bakersfield, California and on the East Coast will be expanded.

In June 2003, Dreyer's combined with the Nestlé Ice Cream Company. The merger brought the total number of Dreyer's manufacturing facilities to eight, adding three new plants to Dreyer's previous five. Four of the eight plants are in California - Union City, Bakersfield, Tulare and City of Commerce.

"A combination of factors led us to this very difficult decision," said William Oldenburg, Dreyer's executive vice president of operations. "We need to balance our production to better serve our customers throughout the country. It is economically inefficient to support four plants in California. We need to plan for future demand, and there are physical limitations that inhibit our ability to expand our Union City plant."