In order to restructure its biscuit production, Orkla is set to build a new factory outside Riga, Latvia, and shuts units currently in the city and in Kungälv, Sweden.
The Norway-headquartered company said it is a strategic the move to control and consolidate production in fewer and more efficient plants. Several different alternatives were considered for the future production of biscuits but the conclusive decision was to build a new factory outside of Riga.
The current biscuit production operations in Kungälv and Riga will be closed down and relocated to the new factory. This change will be carried out by the end of 2022.
In compliance with Swedish labour law, negotiations have been in progress since January between the employee representatives at the factory in Kungälv and the management of Orkla Confectionery & Snacks Sverige.
Currently 350 people are employed at the plant in Kungälv. When production moves in 2022, a product development centre will remain in Kungälv.
Ann-Beth Freuchen, CEO of Orkla Confectionery & Snacks, said: “By investing in a new, modern factory and concentrating production in one location, we can strengthen our future competitiveness and innovative ability and at the same time reduce our climate footprint.
The new production plant will allow us to focus investments on new technology, increase cost effectiveness and create a stronger production platform.”