Raisio to close Southall snack bar facility in UK

Raisio, the Finland-based food group, has decided to close its Southall factory in the UK, following the completion of a consultation process, which began in October to decide on the future of the site.

At the outset of 2016, a portion of the production at Southall facility will be shifted to Raisio’s Newport location, while the remaining part of the production will be outsourced.

This operational structure is expected to bolster cost efficiency, as well as competitiveness in the UK cereal and snack business.

Further, it will enable Raisio to develop a product range that is more consumer-focused.

Its snack bar production will be centralised at the Newport facility, which specialises in snack products.

This will enable the firm to bolster the facility’s production efficiency.

Moreover, by outsourcing cereal production, the company expects to develop a wide product range, with focus on healthier cereal products as well as boosting cost efficiency.

The production at the Southall facility will stop by the end of Q1 in 2016. This move is expected to axe 99 jobs.

Meanwhile, Raisio is reviewing alternative options on the future of its Southall property, which is located near London.

Raisio snack and cereal unit vice-president Tomi Järvenpää said: "Remodelling of the business is necessary to ensure future success of the UK cereal and snack business. The new operating model improves Raisio’s competitiveness in both local and international markets."

In the last quarter of 2015, Raisio reported write-downs of around €4.5m and some €7m as arrangement expenses related to the closure of the Southall site.