Orkla assesses production in Kungälv

Orkla is examining the possibility, in the long term, of moving its biscuit production operations in Kungälv municipality, Western Sweden.

2018-01-18

Ann-Beth Freuchen
Ann-Beth Freuchen

However, no decision has been made to move, and a potential move would not take place for several years. The factory in Kungälv is organised under Orkla’s subsidiary, Orkla Confectionery & Snacks Sverige.

“There are major challenges associated with our production operation in Kungälv because it is located in a limited geographical area in the city centre. With water on one side and residential zones on the other, it is difficult for us to continue to develop our operation, besides which it is a burden on the urban environment. In our prefeasibility study we have examined several options, and have concluded so far as the analysis shows, that the best alternative is to move production to a new, modern factory outside Riga,” says Ann-Beth Freuchen, Orkla Executive VP and CEO of Orkla Confectionery & Snacks.

Orkla also produces biscuits in Riga. Investing in a new, modern factory outside Riga, further building on the expertise there and concentrating Orkla’s biscuit manufacturing in one place will offer a greater possibility of developing the business and strengthening its competitiveness. If, in the long term, production is relocated, product development will continue to take place in the local market.

“It is important to emphasise that this is a proposal and not a final decision. Negotiations are now being initiated in accordance with Swedish labour law. In this process the analysis carried out in the prefeasibility study will be reviewed. A potential decision will be made when the negotiations have been concluded,” Ms Freuchen says.

The factory in Kungälv currently has around 350 employees. As a major employer in the municipality, it is Orkla’s ambition that no one is to be jobless if production is moved out of Kungälv in the long term.

About Orkla

Orkla is a leading supplier of branded consumer goods and concept solutions to the grocery, out-of-home and bakery markets in the Nordics, Baltics and selected markets in Central Europe and India. Orkla is listed on the Oslo Stock Exchange and its head office is in Oslo. In 2016, the Group had a turnover of approximately NOK 38 billion, and 18,000 employees at year end.

Orkla ASA
Oslo, 18 January 2018

Ref.:

Communications Director, Orkla:
Dag Olav Stokken
Tel. +47 916 65 078
Email: dag.olav.stokken@orkla.no