Unite claimed workers feared Mondelēz’s proposal, announced earlier this week (May 7), to combine with Netherlands-based DE Master Blenders 1753 could threaten jobs.
Under the terms of the agreement, DE Master Blenders 1753 would get a 51% stake in the new coffee venture, to be called Jacobs Douwe Egberts.
Speculative
However, in a statement, Mondelēz said concerns over structural implications were premature and speculative, claiming that, in reality, the team-up would demand skilled personnel.
“Any strategic decisions about the shape of this company will be made by the new management team once the partnership comes into effect, which is expected in the course of 2015,” it stated.
“The partnership will require people, manufacturing sites and research capabilities as well as brands. We expect dedicated coffee facilities, including the manufacturing and R&D [research & development] site in Banbury, to move into this partnership.
“The transaction is subject to consultation and it is too soon to give more details.”
Challenging Nestlé’s dominance
The new company would unite the world’s second and third largest coffee groups, which own brands such as Jacobs, Carte Noire and Millicano, challenging Nestlé’s dominance in global coffee sales.
The UK is the largest coffee market in the EU and the Banbury plant is the largest facility in Mondelēz’s manufacturing network, suggesting it is unlikely to be negatively affected by the agreement.
The Banbury factory, which makes brands such as Kenco, Tassimo coffee machine capsules, and Millicano, employs 600 people and has been the main employer in the area for 50 years. It makes 100M jars of instant coffee a year and houses a global centre of excellence for coffee research and development.
“This move has the potential to be highly unsettling for a skilled and dedicated workforce,” said Unite national officer Rhys McCarthy. “The Kenco coffee factory in Banbury is a vital source of jobs for the local community and economy.
‘Seeking guarantees’
“The site has a proud history of food and drink manufacturing and over the coming days we will be seeking guarantees over jobs and assurances that the site will remain a world leader.”
Employees at the factory are likely to be particularly jittery after the bad publicity surrounding Kraft Foods’s takeover of Cadbury in January 2010.
The US-based firm was vilified by some in the UK for scrapping an agreement not to shut Cadbury’s Somerdale factory and shift production to Poland.
Kraft Foods was renamed Mondelēz International in 2012.