Jarvis Porter is pulling the plug on its loss-making Creative Packaging operation in Hinckley, and is set to close the plant with the loss of almost 260 jobs.


The group had made attempts to sell the business, and had more than one potential suitor. MY Holdings is known to have looked at the plant. After negotiations broke down the Jarvis board reluctantly decided that closure of the division is the only way of stemming the losses.


This is a decision we have made with an enormous amount of regret, said chairman Michael Maher. Theres no question that the Wace buy by Jarvis Porter was a bad decision, and the implementation of that decision was poor.


But there are discrete activities in Hinckley including swing tickets, vision packaging and design that can be treated separately and we will endeavour to sell them.


Blue-chip clients include Marks & Spencer, Thorntons, Gillette and Virgin Vie. Maher said the firm was working with customers to ensure continuity of supply.


The closure of Hinckley, which made a loss of 2.9m on sales down 17% at 17.3m in the year to February 2001, will cost the embattled labels and packaging group some 8m.


This is horrendous news and I really feel for our members there, said GPMU national officer Owen Coop. We havent really had confidence in successive management at the plant. The galling thing is that they put four businesses together at Hinckley and its culminated in this.


One ex-Jarvis Porter employee commented: The skill base on the shopfloor and in middle management was superb. To let it all go to waste is shocking."


And Trevor Grice, the former Wace chief executive who acquired the then-Ferry Pickering business in 1995, added: Im not surprised. The business died as soon as label prices for the spirits industry went for a burton. Buying it was a mistake, in hindsight, by Wace.