Cadbury Schweppes to cut workforce

Source: Stock Market Digital

Date :19/06/2007 04:15:53

The confectionery and drinks company Cadbury Schweppes has announced plans to cut 15 percent of its global workforce of 50,000 people by 2011.

Cadbury said that 7,500 jobs will go as part of a cost reduction plan that will also see many of its manufacturing sites close.

Though Cadbury didn’t say whether any UK plants will be axed, the famous Bournville factory near Birmingham is unlikely to be affected. The cost of the restructuring is expected to be £450 million, but is expected to result in an increase in profits from 10.1 percent to the ‘mid teens’ by 2011.

It also announced that a sale was the lost likely outcome of its plan to separate its drinks business, which makes 7-Up and Dr Pepper, from its confectionery operations: “The separation of confectionery and Americas Beverages is progressing well and we continue to pursue a twin track process of either a sale or demerger. The sale process is actively underway, and following expressions of interest, we now believe that a sale is the more likely outcome.”

Private equity groups in the USA have expressed interest in the purchase of the drinks unit, it is believed.