Unite sounds warning over Kraft split

By Anne Bruce

- Last updated on GMT

Related tags Kraft Snack food

Unite sounds warning over Kraft split
Union the Unite is seeking assurances about UK jobs and production at Kraft and Cadbury’s, following the announcement that Kraft is set to split its business into two independent companies.

Unite warned that the US food giant may be seeking to pay down debts built up by the company following acquisitions, including its 2010 take-over of Cadbury.

Kraft wants to split its operations into a global snacks business by the end of 2012. This will incoprate Trident gum, Oreo biscuits, Cadbury and a separate US grocery business including Kraft, Philadelphia cheeses and Capri Sun.

‘Acquisition and debt’

Unite general secretary, Len McCluskey said: “Kraft is a company that is built on acquisition and debt. It is a long time since it profited through innovation. So, we are forced to ask: Is this latest move a way of paying off some of that debt?”

Unite is pressing for urgent talks with Kraft’s management to seek assurances about the security of jobs and production at UK sites, he said.

We want strong pledges ​[from the company] that today’s ‘split’ won’t jeopardise jobs and production in the UK​.”

Kraft was not an easy company to deal with, McCluskey added. “The business ​[Business, Innovation and Skills] select committee accused the company of flirting with ‘contempt’ of parliament for its repeated refusal to put its ceo, Irene Rosenfeld, forward for questioning by MPs.

“Unite has continually argued that this global firm’s intentions towards thousands of its UK workers remain shrouded in mystery.”

Natural division

Kraft said its business had naturally grown in two different directions that "now differ in their future strategic priorities, growth profiles and operational focus".

Its snack food business was focused on fast-growing, developing markets, the company said, while its grocery business was primarily focused on growing revenue in North America.

Kraft said that creating two independent companies was the "next logical step"​.

The multinational's plans still require board-level approval.

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