Kraft's Cadbury factory closure prompts complaint

The Somerdale plant in Keynsham is set to close by 2011

The City takeover panel has received a complaint that US firm Kraft made misleading comments during its battle to take over Cadbury.

Kraft had said that it thought it could save the Somerdale plant, which Cadbury had planned to shut down.

After the £11.5bn sale of Cadbury's was completed, Kraft said the factory, near Bristol, would close, costing 400 jobs.

A local campaigner and a Conservative candidate have complained to the panel, saying Kraft broke the takeover code.

'Learn lessons'

Amoree Radford, who leads a campaign to preserve Keynsham's chocolate factory, told the BBC she had complained to the Takeover Panel along with the local Tory candidate, Jacob Rees-Mogg.

Local MP Dan Norris thinks Keynsham has had it with raised hopes. Being led up the chocolate coated garden path by Kraft execs was bad enough Dave Harvey Business correspondent, BBC West Read Dave's blog

"We know we can't get the jobs back, but we want the authorities to learn their lessons so it doesn't happen to another company later", she said.

However, even if the panel found against Kraft and said that its comments had been misleading, it has limited powers.

Public criticism - the naming and shaming of a firm it feels has acted wrongly - is the regulator's major sanction.

Both Kraft and the takeover panel declined to comment.

Labour MP Dan Norris, whose ward includes Keynsham, had campaigned against the closure, but said that the referral to the panel was unnecessary.

"I think this is a distraction, and the town doesn't need it. It can't bring the jobs back, and worse than that, it will drag everyone back through the heartache they've already endured twice," he told the BBC.

Hearing

Kraft's decision to close the Somerdale factory by 2011 drew criticism from workers and Business Secretary Lord Mandelson.

Last month, it emerged that MPs were to question senior officials from Kraft over its takeover of Cadbury.

The chairman of the Business and Enterprise Committee, Peter Luff, had said MPs wanted to know why Kraft went back on its pledge, and wanted it to clarify its position.

The committee cannot automatically summon foreign companies to give evidence, but Mr Luff said Kraft had already been contacted about the hearing.

The committee will also hear from unions representing Cadbury workers.

Kraft completed its takeover of the UK chocolate maker on 2 February.

Plans to close the Keynsham plant, with the loss of 400 jobs, were originally announced by Cadbury in 2007 as it looked to move production to Poland.

Before its bid was accepted, Kraft told the BBC: "We believe we would be in a position to keep the Somerdale plant operating and we are sincere about that."

However, it said later that it had only become aware of how advanced plans were for the new Poland factory after the takeover deal had been agreed.