UK-based food group Northern Foods plc has announced that its Trafford Park Bakery in Manchester is to close, with the loss of 690 jobs.
The company informed staff of the decision today (24 Aug). Northern Foods said the move reflected the company's "focus on improving the overall performance of the business and is being progressed at this time in preparation for the disposal of the pastry category".
Northern Foods announced at the end of May this year that it intended to sell off its pastry business in order to focus on businesses where it felt it had a competitive advantage.
The Trafford Park unit, which was acquired by the group in 1991, produces chilled savoury pastry products. The company said the unit recorded losses in excess of GBP3m (US$5.7m) in 2005/06.
Northern Foods said there would be a phased closure which would be completed in December 2006. As a result of the closure, Northern Foods said it would incur a one-off charge before tax in the first half of the current financial year of approximately GBP12m, including expected cash closure costs of GBP7m.  However, the anticipated closure cost would be partially offset by any proceeds from the future sale of the assets, the company added.