Tesco is to delist microwaveable snack brand Rustlers by the end of the month and replace it with its biggest rival Feasters.

The retailer's decision to stop selling all hot snacking products manufactured by Kepak Convenience Foods, including Ugo's Deli Café and Speedy Snacks, follows a range review.

The loss of Tesco's business is a massive blow for Kepak, which said it had been forced to restructure its business as a result. It was now in consultation over redundancies, it said.

"Kepak can confirm that Tesco will not be stocking its market-leading range of hot snacking products from mid-October," a statement said. "The announcement follows negotiations to maintain the supply contract, which reached a point where it became commercially untenable to continue to build best-selling brands such as Rustlers, Ugo's Deli Café and Speedy Snacks within Tesco."

Kepak claimed that in the year to May it had a 71% share of the £107m hot snacking category. Its brands had been among Tesco's best-performing lines in the ready meals category, helping Tesco "significantly grow its hot snacking business in recent years", it added.

However, it would not say how much of its turnover was accounted for by Tesco, which has a 30.9% share of the grocery market [TNS]. "Tesco was a substantial percentage of our sales," said a Kepak spokeswoman. "However, we are less reliant than most food brands on the top grocers, with the convenience trade playing a major role."

A Tesco spokesman confirmed the move followed a range review but refused to comment further.