Last night, Frank Hayes, a spokesman for Kerry Foods, said there was no threat to the longterm future of the Durham site, which employs about 540 staff.

He said the business remains "competitive" and the group would look to redeploy as many of the affected staff as possible.

He said, "There has been an ongoing review of Kerry Food's operations in Durham over the past 12 months and that has regrettably led to a maximum of 170 job losses. We are in the process of speaking to staff and the proposed changes will take place over the summer months.

"Durham continues to be a very important operation, but these changes are necessary to continue to operate at maximum efficiency."

Kerry operates about 20 factories across the U.K. and makes own-label ready meals for a range of supermarkets.

One worker at the Durham site, who did not want to be named, said staff were told of the job cuts yesterday afternoon and a consultation process with shop workers' union Usdaw began.

Hayes said Kerry Foods would set up a job centre at the factory, based in Gilesgate Moor, to help people find alternative employment.

Kerry Foods saved hundreds of jobs when it bought Hibernia Foods' ready meals business, in Hartlepool, out of receivership three years ago.

Despite investing millions in the plant, it officially closed in June last year because of a decline in the market. Hib

ernia's other Hartlepool factory was sold to Freshbake Foods, which later collapsed. That business underwent a management buyout, only for the new company Bonne Bouche, to go into administration this year, with the loss of more than 200 jobs.

From the June 4, 2007, Prepared Foods e-Flash