UK own-label firm Uniq will stop making yoghurt at its Minsterley site next year, blaming falling margins in the sector.
The company, which looks set to be acquired by Irish food group Greencore, said yoghurt production at Minsterley will end next April.
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The decision was announced in a document that outlined Greencore’s GBP113m (US$182.5m) takeover bid for the company.
“Despite Uniq’s intention to build its capability and customer base for its premium, differentiated yoghurt at Minsterley, a further reduction in the margins achievable in this sector has lead Uniq to conclude that the returns it can realise from this category are insufficient to justify further investment in capital,” the statement said.
“Consequently, the Uniq directors have decided to withdraw from yoghurt in April 2012. This is likely to result in a number of employees being at risk of redundancy and a consultation process has commenced at the site. It is anticipated that following this restructuring, the loss of this business will not have a material impact of the financial position of the Minsterley site.”
A spokesperson for Uniq said that, with the company subject to a takeover bid, there was “no clarity” on the exact impact on jobs at the moment.
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By GlobalDataThe Minsterley site is one of Uniq’s two desserts plants. Last week, reflecting on Greencore’s bid for Uniq, Shore Capital analyst Darren Shirley said the Minsterley facility had “proved to be something of a problem child” for the company.
However, Shirley said he expects Greencore to continue with Uniq’s restructuring plans for Minsterley, which, could, he said take the business back into the black by the end of 2012.
