Workers told it’s business as usual

Nestle Australia will take over the Uncle Tobys factory in Wahgunyah from Burns, Philp and Company Ltd within weeks.

Nestle executives have told the National Union of Workers, representing most of the 600 to 700 workers, that it “will be business as usual”.

But Nestle is unlikely to make any public commitments about jobs or investment until the deal is finalised within a few weeks.

NUW’s assistant Victorian secretary Esmond Curnow said yesterday the union would meet Nestle as soon as possible to seek assurances that the factory would have a bright future.

“We have always had a constructive relationship with Nestle, but we certainly want to discuss the factory’s long-term future,” Mr Curnow said.

“Uncle Tobys at Wahgunyah has a good plant and a terrific workforce.

“We have almost 600 NUW members there and it’s our biggest site in Victoria.”

Nestle announced the purchase from its world headquarters in Switzerland.

The purchase price of $890 million is about 11.5 times the Uncle Tobys division pre-tax profit of $79 million last year.

The purchase excludes the Bluebird factory in New Zealand.

Competitors for the business are thought to have included Arnott’s, Cadbury Schweppes and General Mills.

The Wahgunyah site was built for Doug Shears’ Inter City Mills in 1979 and sold to Goodman Fielder in 1992.

Burns, Philp, controlled by New Zealander Graeme Hart, bought Uncle Tobys in 2003.

Uncle Tobys had sales of about $400 million in 2005 from its sales of breakfast cereals, nutritious snacks, and instant soups.

Nestle said the Uncle Tobys brand was iconic in the Australian market “with unparalleled respect in nutrition and vitality”.

As part of the overall transaction, Cereal Partners Worldwide, a joint-venture between Nestle and General Mills and the global No. 2 in cereals, will operate the Uncle Tobys cereals business, which comprises more than 40 per cent of sales.