De La Rue has announced plans to stop printing banknotes at its Gateshead plant, putting 255 jobs at risk.
Last year the company cut 170 jobs at the same plant, after it lost its UK passport printing contract to Franco-Dutch group, Gemalto.
Around 100 staff will remain in Gateshead, working in its authentication division and IT.
The union Unite says it’s urging the company to reconsider the announcement:
“Unite has feared this announcement since De La Rue was denied the UK passport contract in 2018,” said Steve Turner, Unite’s Assistant General Secretary for Manufacturing Steve Turner.
“Unite believes that the printing of UK passports is a matter of national security and this contract should never have been allowed to go overseas.
“No other major European country would allow their passports to be printed abroad. Our government talks the talk of ‘taking back control’ and protecting UK interests but has consistently failed to walk the walk and move beyond soundbites to practical action supporting jobs and communities.
“Since the government decision to off-shore UK passport production, the long-term viability of the Gateshead site and the remaining skilled jobs it provides for the north east have been at risk.
“It is now imperative that the government steps in to ensure that the site is preserved and that the contract to print passports is returned to the UK as a matter of urgency.”
De La Rue made the announcement as part of a number of “turnaround plans” in the wake of the loss of the passport contract. This will see further cost reductions and a focus on its Authentication and Currency operations.
It said that it was hoping to fund this through the placing of 91m new shares to raise £100m.
“We are now well underway with our plans to turnaround the Company, with opportunities to grow our revenue and reduce our cost base. Our cost cutting initiatives will enable us to compete harder in the currency market, while the development of security features and polymer will drive growth for this division. Authentication and polymer continue to show strong growth and we see an increasing pipeline of new opportunities,” stated Clive Vacher, Chief Executive Officer of De La Rue.
“The £100m equity capital raising we are announcing today will strengthen the Group’s balance sheet and help us deliver the Turnaround Plan, enabling De La Rue to create value for our employees, customers, suppliers and shareholders.”
