Nestle "could keep Blue Riband in UK for GBP1m" - union - Just Food
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Nestle “could keep Blue Riband in UK for GBP1m” – union

05 Jul 2017

Nestle could keep production of UK biscuit brand Blue Riband in the country with a "one-off" investment of GBP1m, local union the GMB has claimed in its latest bid to put pressure on the company not to shift output to Poland.

Nestle “could keep Blue Riband in UK for GBP1m” – union

Nestle could keep production of UK biscuit brand Blue Riband in the country with a “one-off” investment of GBP1m (US$1.3m), local union the GMB has claimed in its latest bid to put pressure on the company not to shift output to Poland.

The GMB claimed it had learnt during talks with Nestle the world’s largest food maker could continue manufacturing Blue Riband in the UK and “save 300 jobs” with “a one-off capital investment of just over GBP1m”.

In April, Nestle announced plans to shift the production of its UK-centric Blue Riband biscuit brand to a plant in Poland. The move was part of a wider “efficiency” programme Nestle set out across its UK confectionery business, which is set to lead to the loss of 298 jobs across four facilities.

In its latest bid to get the plans reversed, the GMB criticised Nestle and the UK government. The union cited a UK government minister revealing it had met Nestle in April to discuss the company’s plans for jobs and investment.

“UK manufacturing workers deserve better, especially when they see Nestle investing millions in Spanish sites to renovate production lines,” GMB national officer Eamon O’Hearn said, pointing to the Swiss food giant’s move to spend more than EUR2m on an infant formula plant in Spain.

O’Hearn added: “If Government ministers met and knew about the job losses at Nestle UK as far back as April, it begs more questions – what did this Government know and why hasn’t it acted already to stop these manufacturing job losses?”

Nestle had not returned a request for comment at the time of writing.

Earlier this year, Nestle CEO Mark Schneider, who joined the KitKat maker in January, said the company would be spending more on “restructuring” measures this year than in 2016 “to drive future profitability”.

Schneider said in February Nestle would spend around CHF500m (US$518.3m) in 2017 on restructuring initiatives. Last week, when Nestle announced its results for the first quarter of 2017, the company underlined it would “increase restructuring costs considerably in 2017”.

Last week, Third Point, a US hedge fund controlled by Daniel Loeb, took a stake in Nestle equivalent to about 1% of shares and called for a strategy shake-up at the company.

Forty-eight hours later, Nestle outlined where it plans to focus its resources on trying to drive growth, including in the consumer health sector. The company also announced its board had approved a move to buy back shares worth up to CHF20bn. The buyback is scheduled to be completed by the end of June 2020 but Nestle said if it moves to make “sizeable acquisitions” the share purchases would be “adapted accordingly”.