Fivemiletown Creamery ‘almost certain’ to close

Fivemiletown Creamery
Fivemiletown Creamery

Around 50 staff at a County Tyrone creamery will almost certainly be made redundant later this week.

Workers at Fivemiletown Creamery have been on edge after hearing management at the co-operative were in negotiations with two larger companies about the business’ future.

According to reports management at Fivemiletown were in “delicate negotiations” with international company Glanbia as well as co-op Lakeland Dairies.

But the Newsletter has learned an offer from Lakeland, which sought to protect jobs at the factory, was rejected by the shareholders at Fivemiletown.

Fivemiletown Creamery entered negotiations with a number of companies in the summer last year, however, last week Glanbia announced they were in “exclusive negotiations” with the creamery’s management.

It is believed the plant were losing around £1 million per year following the loss of a cheddar cheese supply contract to Kerry Foods in 2012 which accounted for about 60 per cent of their business.

An industry source confirmed that turnover at the company had almost halved to around £11 million and that assets were being eroded on a daily basis.

He added: “The company have been trading on borrowed time since the loss of the Kerry contract. Negotiations to sell the business began last year.

“Although the company are probably best known for their high reputation in speciality cheese brands this only accounted for approximately £500,000 of their turnover.”

Last week staff met with management to discuss the uncertain future of the company and requested a meeting with the board - this took place yesterday.

One long-standing member of staff said they were disappointed to learn of the company’s “almost certain” closure yesterday.

He said: “The company have confirmed that at this stage the most likely outcome will be that the jobs will go. They have indicated that a small number may remain but on the whole we are expecting to receive our 30-day notice at the end of this week. The meeting was a good natured one with many staff pleading with the shareholders to look for alternatives that could save their jobs between now and the end of the week.

“There are staff who have been at the company for over 40 years, some who have never worked anywhere else, others who are second generation and a few who believe they will not find alternative work due to their age.”

It is understood that Glanbia will meet with company shareholders on Thursday night where a vote will take place to decide the future of Fivemiletown.

However, Glanbia are only interested in the company’s “milk pool”. The milk pool for Fivemiletown is worth around 25 million litres per year which would be a significant addition to the Glanbia portfolio.

If the 40 shareholders, all of whom are milk suppliers, vote in favour of accepting the Glanbia offer then all 47 jobs in the company will be likely to be made redundant.

Fivemiletown Creamery will retain ownership of the company assets, including the factory, but as yet it is unknown as to how it will move forward, if at all, with any operations.

The staff member said he believed the shareholders will vote for the deal but he is urging the company to make decisions quickly and ensure workers aren’t left “hanging around” for another weekend.

He added: “Generally the mood is low in the factory. If the vote is passed on Thursday night we would hope that paperwork would be ready to be signed on Friday and an announcement made to staff immediately. We would urge the company to ensure they tie this up before the weekend, the sooner we know what is happening the sooner we can move on with our lives.

“It is hard to remain motivated and continue to produce high quality products and meet deadlines when we are so unsure of our own financial future.”