Ready meals manufacturer Bakkavör has announced plans to restructure three sites in Lincolnshire as it moves to cut capacity in the face of falling demand.

GMB union officials say the cuts could result in up to 400 of the 2,000 staff at the sites being made redundant. Some production at the affected sites - Exotic Farm Produce in Kirton, Freshcook in Holbeach and Bakkavör Spalding - would be transferred to other sites while other facilities would be consolidated.

"We're coming down from annual volume growth of 10% to 15%," said Bakkavör CEO Ágúst Gudmundsson. "In a very short time instead of growth we're seeing reduction. That simply means we need to cut capacity and consolidate the factories."

The move is part of a wider restructuring by the group, including plans to close Mariner Foods in Grimsby. The group is also trying to reduce its £880m debt, appointing Rothschild to look at ways of reducing its liabilities.

Gudmundsson said he felt prospects were strong for the group in the longer term. "Looking ahead we are predicting very strong growth in the markets in which we operate - we are predicting strong growth in Europe and in China."