Blue Circle takes axe to 1,300 jobs

About 1,300 jobs - 350 of them in the UK - are being cut at Blue Circle, the building and heating company, to save around pounds 25m a year.

The company, which warned last December that a major review of poorly performing heating operations would mean redundancies, said further job losses were likely later this year.

In the UK, 240 jobs will go at Blue Circle's boiler plant in Warwick, which is being transferred to Padiham, Lancashire, in the summer. And 110 will be lost through the closure of a domestic radiator plant in Hull and work transferred to Gateshead by the end of the year.

The remaining redundancies are at the Rastede boiler manufacturing operation in Germany, where about 210 cuts are being made. And about 200 are going from French operations, with others in Sweden.

Blue Circle said a further 400-500 jobs in Europe are likely to be cut this year but could not give details about which countries will be affected.

The company said in December that it was seeking approval from French and German regulators before announcing the cuts, and social plans to soften the blow have been sent to government authorities. A provision of about pounds 55m to cover the cost of restructuring is likely to be made in the 1995 results.

A sharp decline in construction business in the UK and mainland Europe have cast a cloud over Blue Circle profits. A large part of the company's turnover comes from people installing new heating systems when moving house. The cement and concrete businesses are said to be doing better, particularly in the US.

The shares have recently picked up following Blue Circle's application for planning permission for its 400-acre site at Ebbsfleet Valley, Kent. The company hopes the site will be turned into a commercial and leisure complex, and earlier this month there were suggestions Donald Trump might be interested in building casinos on the land.

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