Offshoring fear raises alarm at United Biscuits

Union representatives are planning to hold urgent meetings with United Biscuits (UB) this week over fears that the manufacturer will offshore its administrative and financial department to India.

A spokeswoman from Unite said that the union had put pressure on UB to discuss its future, following rumours surrounding the company’s plans. She said that UB’s management had shown her a statement that detailed several options, one of which included offshoring UB’s administrative and financial department to India.
The move, claimed Unite, would result in around 125 job losses and the closure of its current department located on Binns Road, Liverpool.
“We presume that the move to India is part of a larger drive to reduce UB’s costs,” said regional officer Debbie Brannan. “UB is playing down the move at the moment but we know that people from its management team were visiting three sites in India last week.”
A spokeswoman for UB did not deny the plans, but said that the company constantly reviewed its operations to ensure they supported the business in delivering sustainable growth. And that “no decisions have been made about any restructuring programmes”.
The union’s fears began last week, as the first set of workers were made redundant at Cadbury in Keynsham. The factory is due to close in 2010 when production will be moved to Poland. The departures are part of a staggered programme of redundancies agreed last year.
A representative from Unite argued that the move to Poland was making increasingly less sense because of the weakening pound. He added that the wages in Poland had been picking up for some time, making offshoring work there less financially rewarding.
In other news, Asahi Breweries confirmed the purchase of Schweppes Beverages, which will help reduce Cadbury’s debt to more manageable levels. The deal for the Schweppes Beverages business in Australia was confirmed for a total consideration of approximately £550M in cash.
The deal was announced last week after Food Manufacture​ reported​ that the move would reduce debt levels by about £475M after tax and fees, according to Graham Jones, analyst at Panmure Gordon. He forecast that Cadbury’s reduced debt pile would stand at around £1.35bn by the end of 2009, down from £1.89 in 2008.