[an error occurred while processing this directive]
BBC News
Launch consoleBBC News in video and audio
Last Updated: Monday, 19 February 2007, 17:09 GMT
Final warning over 663,000 grant
Cheese processing generic
The Dairygold plant closed its doors in April 2006
A dairy firm which made 115 people redundant after taking a grant has been given a final warning of legal action.

Dairygold Food Products has faced calls to repay a 663,528 grant since closing its cheese packing-plant at Felinfach, near Lampeter, Ceredigion, last April.

The Irish firm was awarded the money in 2002 to expand its packing lines.

Rural Affairs Minister Carwyn Jones said legal action seemed "the only option left". Dairygold said it was working to "resolve" all issues.

Work to expand Dairygold's cheese-packing plant was completed in March 2004.

But 18 months later the firm announced plans to close its factory and the facility closed in April 2006, with the loss of 115 jobs.

An investigation by the BBC Radio Cymru programme, Manylu, found the machinery bought with the grant was sold on to the Kerrygold company, which is part-owned by Dairygold, and was being moved on to its packing plant in Leek, Staffordshire.

Last September, the assembly government said legal action was possible to recover the grant money.

Now Mr Jones has said he was "minded" to pursue that course.

'Unavoidable closure'

He said: "We have had long-running discussions with Dairygold about recovering the grant funding.

"But, unfortunately, on the basis of the position adopted by Dairygold, it seems that legal action is the only option that is left to us.

"I have now written to Dairygold's lawyers to notify them formally that we are minded to start legal proceedings very soon.

"I have given them one final opportunity to provide further information. I will ensure that everyone concerned is kept informed of further progress."

In a statement, Dairygold said: "Dairygold Food Products (UK) Ltd is actively working with the Welsh Assembly Government since the unavoidable closure of its Felinfach cheese packing facility to satisfactorily resolve all agreements on all matters."

Factory grant repayment criticism
31 Jan 07 |  Mid Wales
Legal threat over factory grant
26 Sep 06 |  Mid Wales
Play attacks cheese plant closure
21 Sep 06 |  Mid Wales
Cheese factory in grant row shuts
13 Apr 06 |  Mid Wales
Calls for firm to repay grant aid
30 Mar 06 |  Mid Wales

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

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Americas Africa Europe Middle East South Asia Asia Pacific