Hillsdown Holdings, the food manufacturing conglomerate, is set to abandon its loss-making pig-meat businesses with the loss of up to 420 jobs.
The jobs will go at the company's C&T Harris subsidiary, which is negotiating with unions over the closure of two pig-meat plants in Ipswich. Hillsdown is negotiating to sell the remainder of the Harris business to Unigate for pounds 11.4m.
Unigate said it planned no job losses at the two plants and hoped to add more staff as the business progressed.
Unigate's chief executive, Ross Buckland, said: "Three or four years ago we were just another pig-meat operator. But thanks to capital investment and good management we have managed to build markets in other countries and grow the business."
Hillsdown and Unigate have experienced widely different fortunes in the pig market. Hillsdown has struggled with smaller volumes and the Harris business made an undisclosed loss last year on sales of pounds 110m. The company has been pulling out of commodity businesses where it could not establish itself as a low-cost producer.
Harris has been hit recently by the high pig prices as well as pressure from Unigate's more successful Malton pig businesses.
Unigate has invested pounds 40m in its pig businesses in the last three to four years. The company now achieves undisclosed profits on sales of pounds 350m.
It has successfully increased volumes while seeking other markets. It has been selling higher priced items abroad such as pork spare ribs to the United States. This has enabled it to reduce prices in the UK, placing pressure on rivals such as Hillsdown.
The Harris deal is Unigate's second pig purchase this year. In January it bought Booker's two bacon businesses, Stock Lovell and Lovell and Christmas for pounds 20m.
Unigate is cash-rich after the pounds 332m sale of its 29 per cent stake in Nutricia, the baby milk company in December.
It is also tipped as a possible bidder for Geest, which after the sale of its banana business to Fyffes is now a manufacturer of chilled foods and prepared meals.
Unigate shares closed 6p higher at 443p. Hillsdown shares were 2p lower at 172p.Reuse content