Page last updated at 13:34 GMT, Tuesday, 16 March 2010

Kraft apologises over Keynsham Cadbury pledge

Marc Firestone told MPs he was 'terribly sorry' Kraft pledged to keep Somerdale open

A senior Kraft Foods executive has said he is "terribly sorry" for the firm's earlier pledge to keep open Cadbury's Keynsham plant.

Marc Firestone said the pledge was made in good faith as Kraft expected output to be high enough to sustain the plant. The factory is now being shut down.

Mr Firestone was taking MPs' questions on Kraft's takeover of Cadbury.

He added that he expected no further closures or jobs losses in Cadbury's UK manufacturing for at least two years.

MPs expressed incredulity over Mr Firestone's assertion that Kraft felt it could keep the plant open.

Earlier in the session, Jack Dromey from Unite union said Kraft was "utterly cynical to pretend it could reprieve the plant".

He said Kraft must have known it was not possible to keep the plant open.

Unions and local politicians have complained that Kraft misled employees over the issue.

Official complaints have already been lodged with the City's takeover panel - the body responsible for regulating takeovers and mergers.

Fresh information

During a heated session, Mr Firestone said he understood the concerns raised by the MPs, but said that Kraft fully intended to keep the Somerdale plant in Keynsham when it made the pledge last year.

He said the company was aware of Cadbury's plans to close the plant and move some production to Poland.

But he said that with the combined production of both Kraft and Cadbury, the US company felt that the plant could, in fact, remain open.

Only when Kraft found out later that Cadbury had already spent tens of millions of pounds kitting out its factory in Poland, Mr Firestone said, did Kraft decide that it had no choice but to renege on its commitment to Somerdale.

He said there was no way Kraft could have known about Cadbury's investment in Poland, as the information was not in the public domain and the two companies were not talking with each other during the hostile bid.

He said Kraft was "terribly disappointed" that it could not keep the plant open.

The committee of MPs said they found it hard to believe that Kraft could not have known the full extent of Cadbury's investment in its new Polish factory.

There were laughs and calls of "nonsense" from the panel. Liberal Democrat MP Lembit Opik said he found it hard to believe that no-one had been sacked over the pledge.

The MPs said the pledge should not have been made unless Kraft was absolutely sure that Somerdale could be kept open.

Future pledges

Mr Firestone said Kraft stood "100% behind" Somerdale workers and would do all it could to help them find new jobs.

He also pledged there would be no further closures of manufacturing sites in the UK, and no further compulsory redundancies in manufacturing in the UK in the next two years.

Trevor Bond, the ex-boss of Cadbury in the UK who is now heading Kraft across Europe, said the firm had no plans to rename any of Cadbury's brands managed out of the UK and would continue to produce Dairy Milk in the UK.

He added that Kraft would continue to sponsor the 2012 Olympic Games under the Cadbury brand.



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