Jobs blow as brewery closes

Brewer Scottish & Newcastle today announced plans to close its Reading brewery with the potential loss of 362 jobs.

The Foster's and Kronenbourg 1664 maker, which is being bought by European rivals Heineken and Carlsberg for £7.8 billion, said the site would close by early 2010. S&N said closure of the former Courage brewery - open since 1979 - was the "most viable option going forward".

The closure follows the company's November decision to shut a bottling plant at the Reading site, costing around 250 jobs. S&N has also shut breweries at Newcastle and Fountainbridge in Edinburgh during recent years to cut costs. S&N said the latest move would address a "general over-capacity" in the UK brewing sector - as well as saving the brewer around £13 million a year.

The company's group operations director, Stephen Glancey, said: "The nature of the Reading site, the amount of investment required to make it competitive and its relative cost compared to other UK facilities means that there is a strong business case for closure.

"We will, of course, do all we can to mitigate the effects of the closure on the people affected."

The closure of the 58-acre site will leave S&N, which also makes John Smith's and Newcastle Brown Ale, with around 3,000 UK staff. It will begin talks with union officials in the next few days.

The company added: "S&N will work closely with local agencies to ensure that the impact on the local economy and community is minimised."

Brewing and packaging work will be transferred to the company's other sites, which include Tadcaster in North Yorkshire, the Royal Brewery in Manchester and Dunston, Gateshead.

The Edinburgh-based group - the UK's last major independent brewer - has informed its prospective new owners of the plans.

Heineken and Carlsberg, whose fourth approach for S&N was finally agreed by the group's board last month, plan to break up the company when the deal is completed, with the UK business falling into Heineken's hands.

The Unite union said it was "outraged" by the announcement, adding that workers were still "reeling" from the effects of cuts announced by the company last year.

"There seems to be absolutely no rational reason for closing this brewery," said a spokesman.

Iain Loe, research and information manager at the Campaign for Real Ale (Camra), said the closure of the brewery was "the end of an era".

Courage - eventually bought by S&N in 1995 - moved its operations to the site almost 30 years ago after itself acquiring local brewer Simonds in 1960. Simonds began business in Reading back in 1785.

Mr Loe said: "Courage was investing in new breweries but all that has gone now - the name of the game is global production of global brands."