Kerry Group suffer a setback in UK

Food giant met with rare reversal as Tesco UK cancels deal

Simon Brouder

Tralee-based international food and ingredients giant Kerry Group has suffered a rare setback with the news that supermarket chain Tesco has cancelled a major contract with the group.

On Friday it emerged that Tesco had cancelled a contract with Kerry Group to supply ready meals to the supermarket's outlets across the United Kingdom.

The ready meals had been produced at Kerry Group's production plant in Burton-on-Trent, which employs around 1,000 people.

Kerry Group has not provided details as to how much the contract was worth or how many of the Indian and Oriental chilled dinners it produced at the plant for Tesco's UK outlets.

A group spokesperson said that there will be an eight-month transition before the supply contract officially changes hands.

In that period Kerry Group will seek a new supply deal to fill the void at the Burton factory.

Kerry Group said it was not in a position to comment on any potential job losses at the factory, where many staff now fear for their future.

"Regrettably, a major customer has confirmed it will be moving our chilled meals business, currently produced at our Burton site, to another supplier," said the Kerry spokesperson.

"We have been working together for nearly two decades and, as one of the biggest employers to the local area, our first priority is to our people," the spokesperson said.

"We will continue to work with them and relevant suppliers in the near future as we explore other opportunities for our business," said Kerry Group.

The loss of the Tesco contract comes in the same week that Kerry Group announced two major acquisitions - worth over €365 million - in the United States and the Middle East.