UK food company RHM has announced that it is to invest over £45m (US$80.2m) in Manor Bakeries, its cake producing business, over a three-year period in a bid to further strengthen the business’s market-leading position.

Manor plans to significantly increase marketing investment behind the Mr Kipling and Cadbury brands. A major part of this investment will be the development of existing and new products to exploit the high-growth premium segment.
In addition to the significant increase in marketing investment, Manor’s management is also taking action to reduce operating costs and eliminate under-utilised capacity.

As part of this plan the company has proposed that the Eastleigh factory, near Southampton, will close by December 2005 and capacity at the Moreton factory will be reduced from four to two plants over the same period.

Investment at the Carlton and Stoke factories, where production is to be increased, is expected to result in the creation of around 350 new jobs, resulting a net reduction of around 330 jobs.