Fears for 1,000 jobs in glass deal probe

The government-sponsored Office of Fair Trading has called for a review into a £50 million deal involving Rockware Glass and Rexam Glass, which was designed to save local jobs.

The companies employ around 1,000 people in Doncaster, Worksop, Knott-ingley and Irvine in Scotland, and around 700 people in Barnsley.The deal was designed to preserve jobs threatened by a rival, the Irish Quinn Group, which is close to completing a £200 million plant at Elton, near Ellesmere Port.A report presented to Barnsley Development Agency last year predicted Quinn's development could lead to the loss of 1,000 jobs in South Yorkshire and do tremendous damage to the Yorkshire glass industry, which produces 73 per cent of UK glass packaging.Vincent Smith, OFT competition enforcement director, says Rockware and Rexam – which is reverting to its previous name, Redfearn – would produce 50 per cent of most types of glass containers made in the United Kingdom.The OFT has called in the Competition Commission to investigate.It is concerned that competitors in the UK and abroad would be put at a disadvantage by the takeover, spearheaded by Rockware parent group Ardagh Glass, based in Guernsey."The evidence is mixed, and, together with the substantial customer concerns received by the OFT, these factors lead the OFT to refer the merger to the Compet-ition Commission for further examination," said Mr Smith.

The decision to call in the Competition Commission, which could take up to four months to report, has raised concerns for union officials who were supporting the takeover on the grounds that it would save jobs.

Mike Frizelle, of Amicus, believes the Competition Commission won't be able to judge the potential impact of the Quinn factory in Cheshire on the UK market as it is not yet fully operational. He questions whether an alternative buyer could be found for Rexam/Red-fearn, which has invested heavily in modernisation.
"I would ask the Competition Commission what the alternative is if Redfearn isn't bought by Rockware Glass. I don't believe there are a lot of people wishing to take on Rexam's glass factory at Monk Bretton," he said.
Mr Frizelle.

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