Samworth Brothers is planning to close Cornwall-based desserts and cakes manufacturer Kensey Foods.
The company, which owns brands including Ginsters and West Cornwall Pasty Co, has begun formal consultation with the 650 staff at the operation, which it plans to close by the end of July.
Operating from an 11-acre site in Launceston, Kensey Foods makes desserts, including custard tarts, cream cakes, fruit pies, crumbles, tarts and sponge puddings for UK retailers.
Samworth said that, despite significant financial investment and hard work, Kensey had been loss-making for the past six years.
“When combined, the investments and annual losses have added up to tens of millions of pounds, and this is not sustainable for any business,” it stated.
Samworth added that the age and capability of the plant meant significant additional capital investment would be required, which it did not consider commercially viable.
The company hopes to redeploy a “good number” of affected staff to The Cornwall Bakery in Callington, where Ginsters pasties are produced, or other Samworth locations.
Last year, Samworth closed the Brooklands Bakery, which had previously been part of the Euphorium bakery business owned by Tesco. Samworth said that, despite significant investment, Brooklands had continued to operate at a loss.
In November, Samworth announced it was to acquire 2 Sisters Food Group’s Manton Wood sandwich business, which was formerly part of Solway Foods.
Also last year, Andy Stapley left his role as managing director at Kensey Foods to take up the position of chief executive at bakery ingredients supplier Macphie.