Post by earl on May 9, 2008 12:49:46 GMT
The company that owns Guinness has announced plans to lay off 250 workers as part of a restructuring of its Irish operations.
Diageo says the famous St James' Gate brewery in Dublin will be “upgraded and consolidated” and will produce Guinness primarily for the Irish and British markets.
Production in Kilkenny and Dundalk will also be transferred to a new €650m brewery, set for completion in 2013, to be built on an unspecified location close to Dublin.
Operations at Diageo's Waterford brewery will be streamlined as part of the re-organisation, resulting in some reduction in output. The Belfast packaging facility is unaffected by the developments.
Following the completion and successful commissioning of the new breweries, surplus land on parts of the St James' Gate site as well as in Dundalk and Kilkenny, estimated to have a current value of approximately €500m, will be available for redevelopment.
Diageo said that it will ensure that affected employees are offered relocation opportunities where possible but, where this is not possible, they will be offered a severance package alongside career counselling and outplacement support.
“Regrettably, when the new brewery is commissioned in 2013, all production from existing breweries in Kilkenny and Dundalk will be transferred, resulting in the closure of these facilities,” said a company statement.
“Both of these breweries have played a critical role in the historic success of Diageo's beer brands in Ireland but currently do not have the scale necessary for sustained success in increasingly competitive market conditions. They are also not suitable sites for the size of the new brewing operation, which must be constructed while existing operations are maintained.
“Similarly, the assessment determined that it would not be feasible to concentrate all brewing activity on a single site at St James' Gate due to substantial operational and logistical difficulties.”
The Guinness Storehouse will remain in place to accommodate growing visitor numbers, now expected to surpass one million people per annum.
The company said the proposal “would result in the rejuvenation of the historic St. James's Gate brewery and the construction, close to Dublin, of a new state of the art brewery, which would produce all beer types.
“It follows a comprehensive assessment of all brewing operations in Ireland, which was undertaken over the past 12 months. The assessment identified the optimum strategy to deliver the global competitiveness necessary for future growth and sustained success.”
Commenting on the announcement, Diageo chief executive Paul Walsh said: “This will be the single biggest capital investment made by Diageo in its supply infrastructure since the company's creation 10 years ago and will enhance the cost competitiveness of our global beer operations.
“It represents a major vote of confidence in our beer business and in Ireland as a global brewing centre of excellence for our company.
“This proposal will support the long-term success and growth of Guinness around the world, as well as the other beers we brew for Ireland, Great Britain and international markets.
“Or ambition is to create a brewing hub which will meet the highest standards of technology, efficiency and environmental management. It will marry 21st Century solutions to our 300 years of brewing tradition, craft and heritage in what I believe will be a winning combination."
Mr Walsh also paid tribute to employees who may be affected by this proposal.
"Diageo values enormously the contribution of our staff to our business and we recognise the impact this proposal would have on employment levels,” he said.
“We will work with our staff to reduce the effects of our plans as far as possible. I also want to fully acknowledge the huge role and heritage of the Kilkenny and Dundalk breweries, which would cease operations once the new brewery is fully commissioned.
“I believe that the lessons and experience we draw from their valuable tradition and heritage can only help to enrich our new brewery.”
The company will now engage in formal consultation with employees on the implementation of the proposal.
Diageo says the famous St James' Gate brewery in Dublin will be “upgraded and consolidated” and will produce Guinness primarily for the Irish and British markets.
Production in Kilkenny and Dundalk will also be transferred to a new €650m brewery, set for completion in 2013, to be built on an unspecified location close to Dublin.
Operations at Diageo's Waterford brewery will be streamlined as part of the re-organisation, resulting in some reduction in output. The Belfast packaging facility is unaffected by the developments.
Following the completion and successful commissioning of the new breweries, surplus land on parts of the St James' Gate site as well as in Dundalk and Kilkenny, estimated to have a current value of approximately €500m, will be available for redevelopment.
Diageo said that it will ensure that affected employees are offered relocation opportunities where possible but, where this is not possible, they will be offered a severance package alongside career counselling and outplacement support.
“Regrettably, when the new brewery is commissioned in 2013, all production from existing breweries in Kilkenny and Dundalk will be transferred, resulting in the closure of these facilities,” said a company statement.
“Both of these breweries have played a critical role in the historic success of Diageo's beer brands in Ireland but currently do not have the scale necessary for sustained success in increasingly competitive market conditions. They are also not suitable sites for the size of the new brewing operation, which must be constructed while existing operations are maintained.
“Similarly, the assessment determined that it would not be feasible to concentrate all brewing activity on a single site at St James' Gate due to substantial operational and logistical difficulties.”
The Guinness Storehouse will remain in place to accommodate growing visitor numbers, now expected to surpass one million people per annum.
The company said the proposal “would result in the rejuvenation of the historic St. James's Gate brewery and the construction, close to Dublin, of a new state of the art brewery, which would produce all beer types.
“It follows a comprehensive assessment of all brewing operations in Ireland, which was undertaken over the past 12 months. The assessment identified the optimum strategy to deliver the global competitiveness necessary for future growth and sustained success.”
Commenting on the announcement, Diageo chief executive Paul Walsh said: “This will be the single biggest capital investment made by Diageo in its supply infrastructure since the company's creation 10 years ago and will enhance the cost competitiveness of our global beer operations.
“It represents a major vote of confidence in our beer business and in Ireland as a global brewing centre of excellence for our company.
“This proposal will support the long-term success and growth of Guinness around the world, as well as the other beers we brew for Ireland, Great Britain and international markets.
“Or ambition is to create a brewing hub which will meet the highest standards of technology, efficiency and environmental management. It will marry 21st Century solutions to our 300 years of brewing tradition, craft and heritage in what I believe will be a winning combination."
Mr Walsh also paid tribute to employees who may be affected by this proposal.
"Diageo values enormously the contribution of our staff to our business and we recognise the impact this proposal would have on employment levels,” he said.
“We will work with our staff to reduce the effects of our plans as far as possible. I also want to fully acknowledge the huge role and heritage of the Kilkenny and Dundalk breweries, which would cease operations once the new brewery is fully commissioned.
“I believe that the lessons and experience we draw from their valuable tradition and heritage can only help to enrich our new brewery.”
The company will now engage in formal consultation with employees on the implementation of the proposal.