Northern Foods has announced plans to close its factory in Swansea, putting 234 jobs in jeopardy.

A spokesman from Northern told Reuters the site would no longer be supplying ready meals to Sainsbury’s, forcing the decision to close the factory.

"Mutually agreeable terms could not be reached and, as a result, we have reluctantly decided to terminate the existing supply business,” he said. “We will be commencing consultation with employees on a proposal to close the site."

Northern said its 2010 year-end results would include exceptional costs of approximately £16m as a result of the closure.

The maker of Fox’s Biscuits and Goodfella’s pizza also expects to absorb a one-off cash restructuring charge of approximately £4m in the next financial year related to the closure.

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