Gateshead factory closure puts 430 jobs at risk

Hundreds of jobs are set to be axed at a North East factory which supplies supermarkets with fruit and juices.

Orchard House Foods blamed rising costs and a shortage of staff for its decision to shut its site in Gateshead.

The business, which supplies the likes of Marks & Spencer, Tesco and Pret A Manger, plans to relocate production to its base at Corby, Northamptonshire.

It has started a consultation over the 430 jobs at risk of redundancy and wants to move by the end of November.

A "significant number of jobs" will be created at Corby, with support for colleagues from Gateshead who wish to relocate, it said.

The decision to relocate comes 18 months after UK private equity fund Elaghmore purchased Orchard House for about £25m.

Chief executive Steve Corby said: "Despite making significant investments in our Gateshead facility over a considerable period in an effort to turn around its financial performance, it is unfortunately still making losses that make it unsustainable over the long term."

It was not a decision which had been "taken lightly", he added.

"Like many other businesses across the UK, we have been suffering from a series of economic and business challenges.

"They include rising energy, raw material, transport and labour costs.

"There has also been a shortage of available staff to work at our Gateshead site."

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