FDBusiness.com

VION Food UK has announced it could be forced to close its loss making site, Hall’s of Broxburn, employing over 1,700 people, despite investing heavily in the site over the last four years in an attempt to stem huge losses. The Scottish site has continued to record unsustainable losses, in spite of significant capital expenditure and major restructuring exercises. VION Food UK has commenced a 90-day consultation exercise with its unions and workers.

VION UK chairman Peter Barr comments: “Every possible step has been taken to secure the future of the business but we are currently losing £79,000 per day at the site, which is clearly unsustainable. There is significant over-capacity in the UK meat industry and market conditions are extremely challenging.”

The latest accounts for the VION UK companies show a significant deterioration in financial performance compared with the previous year. Peter Barr continues: “Over the past four years, we have restructured this plant, invested heavily in the site and have brought in new management from across the group in an attempt to stem the losses, which have arisen in part due to the complexity and inefficient layout of the plant. Regrettably the plant remains very heavily in the red despite our best endeavours.”

Hall’s of Broxburn was purchased by VION Food Group in August 2008 when it acquired the troubled Grampian Country Food Group.

The plant was purchased by VION Food Group in August 2008 when it acquired the troubled Grampian Country Food Group, which had been in financial difficulties for several years. Hall’s of Broxburn, employing 1,150 permanent and 595 agency staff, is the major processing facility for Scottish pork, handling 8,000 pigs each week.

VION UK, part of the Netherlands-based VION, currently employs almost 12,000 staff at 40 facilities across the country and is a major supporter of the UK farming industry, producing and processing beef, lamb, pork and chicken, as well as a range of sausages, cooked meats and other convenience products.

Peter Barr adds: “If the consultation exercise does not reveal a viable way forward for this plant, a proportion of the work from these facilities will be transferred to other VION UK plants to strengthen their performance and help secure jobs. However, the market conditions are so severe that we will cease to supply the majority of products currently handled by this plant. We will make every endeavour to identify other Scottish producers who may be able to produce some of these products.”