Kraft says sorry over false hopes of Cadbury factory

US FOOD giant Kraft publicly apologised yesterday for having raising false hopes that a doomed Cadbury factory could be saved as it also issued a two-year guarantee on jobs.

The apology came as MPs on the business select committee grilled Kraft executive vice-president Marc Firestone for two hours. They accused the group of "pillaging" an iconic British company via its 11.9 billion takeover.

The US firm said in a Stock Exchange statement on 7 September: "We believe we would be in a position to operate the facility." But it reversed this pledge on 9 February, shortly after the bid succeeded.

Labour MP Roger Berry said: "You were winging it. You were treating people with enormous disrespect, misleading them and conning them."

MPs said the aim seemed to be to divide opposition to the takeover bid, which was initially hostile but later recommended, by getting UK workers onside.

Firestone acknowledged that the U-turn on Somerdale had been a "hugely controversial subject" that had damaged the American group's reputation.

He said Kraft had created uncertainty among 400 workers at the plant, near Bath – whose planned closure Cadbury had already announced two years earlier. "We are terribly sorry for that," Firestone said.

He said Kraft had a good commercial basis for thinking it could keep Somerdale open alongside two Polish plants, one new-build and one existing.

But Firestone said Kraft was unaware that in October and November last year that Cadbury had spent what a business colleague told MPs was 100 million on equipment for the new-build Polish site at Skarbimierz. Tens of millions of pounds had been spent on the other Polish site at Wroclaw.

Kraft had satellite images of the new site, but they did not show the expensive equipment, Firestone said, and this destroyed the rationale for keeping Somerdale open.

Firestone told the committee: "Unbenownst to us while the bid was progressing equipment was going into the Polish factory.

"I see the looks of disbelief, sir. But we had no prior access to that information."

Firestone, who said he reported directly to Kraft chief executive Irene Rosenfeld, told the committee that for the next two years there will be no further UK factory closures or compulsory redundancies among UK manufacturing workers. There were no current plans to move production abroad.

"We want to regain the trust of our colleagues, government and public," he said, adding this would be done better with actions rather than words.

However, Lindsay Hoyle (Labour), said Kraft had made the same promises to Terry's of York when it acquired it in 1993 before shutting it down and moving production of the Chocolate Orange to Poland. He accused Kraft of doing "exactly the same" to York as the Vikings: "They pillaged and asset-stripped that company."