20 November 2012 Last updated at 08:44 ET

Premier Foods to cut 900 jobs in bread division

Workers have spoken of their "devastation", as Premier Foods cited the loss of a major contract

Premier Foods, the maker of Hovis, is cutting 900 jobs at its bread division and is closing two bakeries.

The company said it would close two bakery sites in Greenford, west London and Birmingham some time next year.

Premier, which is the country's largest branded food producer, is also simplifying its bread distribution network by cutting some 130 routes.

Unions said the job losses were "devastating" and called for urgent talks with Premier's management.

The closures come on top of the previously announced closure of its bakery in Eastleigh, Hampshire.

Greenford and Birmingham will also see their distribution centres close, along with Plymouth and Mendlesham in Suffolk.

The job losses also stem from Premier's move to restructure its logistics operations.

Premier's other major brands include Bisto, Mr Kipling and Sharwood's.

'Increase focus'

Premier has been selling off top name brands which it says it does not consider "core" ones, in order to cut its debts of more than £1bn.

In March its creditors gave it extra time to repay its debts.

Well-known brands that have been sold include the Branston range of pickles and sauces, Robertson's jam and Sarson's vinegar.

The changes to the bakery division also take account of the loss of a "low margin" contract with a supermarket to produce bread, worth £75m, which was announced last month.

The company's chief executive, Michael Clarke, said the cuts were critical for securing the bread division's future: "By simplifying our cost base, we can increase focus on improving efficiency, quality and service levels to help grow our core Hovis business.

"We recognise the impact these actions will have for our employees at the sites affected. Decisions will not be taken lightly but they are necessary if we are to build a strong and successful future for the bread division and those who remain with our business."

'Disaster story'

The country's largest trade union, Unite, has joined with BFAWU, the majority union on the affected sites, to call for an urgent meeting with the company's management.

"This is just another stage in the disaster story that has been Premier Foods over recent years, which has consistently struggled ever since its decision to buy Hovis in 2006," said Jennie Formby, Unite national officer for food and drink.

"Management claims the job losses are as a result of 'competition and wheat prices', but the reality is that our members are continuing to pay the heavy price of Premier's failure to make a success of the business and we remain extremely concerned about the future of the remaining business."

Premier's 'Power' brands
Brand	Products	Origins
Ambrosia	Custard, rice pudding	Begun by an American entrepreneur, a British businessman and a Devon pub landlord
Batchelors	Soups, mushy peas, dried foods, including pasta and noodles	Founded by William Batchelor, a former tea salesman, in 1895
Bisto	Gravies and sauces	In 1908, prompted by their wives to make gravy-making easier, Roberts and Patterson - employees at the Cerebos salt company - came up with Bisto gravy powder
Hovis	Bread, biscuits	Hovis came into being in 1890. The name was prompted by a national competition. It comes from Latin "Hominis Vis" - meaning "strength of a man"
Loyd Grossman	Italian, Thai and Indian cooking sauces	Started in the 1980s by the TV presenter of the same name
Mr Kipling	Cakes and pies	Became the UK's leading cake brand in 1976. Has stayed the biggest-seller ever since
Oxo	Stock cubes and gravy enhancers	Professor Liebig invented extract of beef in 1840. Oxo name born in 1900
Sharwood's	Chinese, Thai and Indian sauces and traditional accompaniments	Established in 1889