Premier Foods to shed about 600 staff to cut costs

Premier Foods Premier Foods has struggled despite owning major brands including Mr Kipling

Related Stories

Premier Foods has announced plans to sell off non-core businesses and cut about 600 staff in an attempt to double cost savings to £40m a year.

The firm behind brands including Paxo and Mr Kipling is to make about 5% of its 12,000 workforce redundant.

Its current cost-saving target of £20m is to be doubled by 2013, as it expects 2011's results to be at the "lower end" of market expectations.

In November, the firm said it agreed breathing space on its debts.

A "covenant test" - used by Premier's lenders to check on its financial health - had been due on 31 December.

It has been delayed until 31 March to allow time to renegotiate its debts.

New chief executive Michael Clarke is focusing the group on eight of its biggest brands.

He said: "Discussions with the company's banks over a re-financing package continue to make progress and it is anticipated that an appropriate agreement will be reached soon.

"While decisions to reduce the workforce are always difficult, I am convinced we are taking the right steps in the long-term interests of the businesses."

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

More Business stories


Features & Analysis

Elsewhere on the BBC


  • Kinetic sculpture violinClick Watch

    The "kinetic sculpture" that can replicate digital files and play them on a violin

Try our new site and tell us what you think. Learn more
Take me there

Copyright © 2015 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.