Fears as factory sale is confirmed

AROUND 700 employees at the Birds Eye factory in Lowestoft had their fears realised yesterday as consumer products giant Unilever confirmed that it was putting the business up for sale.

AROUND 700 employees at the Birds Eye factory in Lowestoft had their fears realised yesterday as consumer products giant Unilever confirmed that it was putting the business up for sale.

Anglo-Dutch-based Unilever is seeking to off-load most of its frozen food businesses across Europe follow a review which concluded that they offered limited growth prospects.

Reports of the disposal plan emerged earlier this week and staff that the Lowestoft factory were given confirmation at a meeting yesterday morning, as Unilever made an official announcement to the stock exchange.

Besides the Lowestoft plant - which specialises in vegetable products, particularly locally-grown peas - the Birds Eye business in the UK also includes a fish products factory in Hull, which employs a further 600 people.

In all, Unilever plans to sell frozen food businesses in 10 European counties, with the disposal also including the Iglo brand outside of the UK with the exception of Italy. However, the group plans to retain its ice cream business, which includes the Walls and Carte D'Or brands.

Unilever indicated last year that it was looking at future options for the frozen foods businesses and chief executive Patrick Cescau said yesterday that the decision to put them up for sale had been “a tough call”.

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He said: “It has been a successful business for us over many years; we've built some great brands for consumers with memorable advertising, and they've created real value for our shareholders.”

However, he said the review had concluded that a strategy to grow the businesses - which have total turnover of around two billion euros (£1.37 billion) - would not deliver satisfactory value for the company.

Brian Revell, national organiser for food and agriculture at the Transport & General Workers Union - which has more than 650 members at the Lowestoft site - said Unilever's decision to sell as “a matter of profound concern”.

“The Lowestoft factory has attracted a loyal workforce who now face an unsettling and uncertain wait,” he said. “The T&G is very disappointed that, of all the options put forward for the future of the site, Unilever has chosen to sell.

“We will keep a very close watch on the situation but, in addition to job security, there will be natural concern over the future of the pension arrangements.”

Besides fears of job security for workers at the Lowestoft plant, the pending change of ownership will also be of concern to local farmers which supply vegetables to the site.

However, Waveney MP Bob Blizzard said that although the decision to put the business up for sale was a cause for anxiety it was important to remain positive about the plant and the town of Lowestoft as a whole.

“While today's announcement will bring further uncertainty and anxiety to the workforce and the whole town, we know that the Lowestoft factory is one of the most efficient and productive food factories in the country, as it received 'Factory of the Year' and 'Manufacturer of the Year' awards in 2005,” he said.

“It should therefore be an attractive part of the business for a new buyer. The root of the problem is not Lowestoft's performance, but fewer people buying Birds Eye's premium products in the face of competition from 'own brand' frozen food and chilled foods right across Europe.

“The Birds Eye factory is a big slice of Lowestoft's economy. This is a time to stress the positive about Lowestoft, to encourage that new buyer,” added Mr Blizzard.

Unilever took control of Birds Eye in 1943 when it became the majority shareholder in Frosted Foods which owned Birds Eye and the UK rights to a method of food preservation then new to mass markets - deep freezing.