THE Mr Kipling cake factory is set to close with the loss of 423 jobs by the end of next year.

Workers were expected to be given the news today at 2pm as the giant Manor Bakeries briefed its workforce across the country.

The move follows what the company describes as an "exhaustive review" of its business across four sites at Eastleigh, Moreton on the Wirrall, Stoke-on-Trent and Carlton near Barnsley.

A company spokesman confirmed to the Daily Echo that it was proposed to close the Eastleigh factory by the end of 2005 while making nearly half of 550 staff at the Moreton site redundant.

He said union representatives had been fully briefed on the background of the move which aimed to concentrate production at Stoke and Carlton.

"It is very much a commercial decision," he added.

Chief operating officer of Manor Bakeries Patrick Irving told the Daily Echo: "We are in a highly competitive market here and we have excess capacity.

"This move is aimed at making us much more competitive for the future of the business and the people who work in it.

"Obviously we have had to take some hard decisions and it is a particularly severe blow for Eastleigh."

He added: "We have a very loyal and hard-working workforce and this decision is no reflection on their commitment to our business."

A company spokesman stressed that the cake market - worth £1 billion a year - was not in decline and that the decision had been taken purely on economic and commercial grounds.

He said the UK cake market was growing but producers were suffering from excess capacity.

"Although it is a big and growing market the company has to remain as competitive as possible.

"If there was an alternative the company would have looked at it but there was no viable alternative."

Manor Bakeries, which has about 25 per cent of the cake market, also runs a giant bread bakery in Eastleigh but that will not be affected by the decision.

The company said it was concerned that people who would lose their jobs should be given as much opportunity as possible to find alternative employment which was why they were making the announcement at this stage.

There would be jobs available in the group elsewhere but the company understood that relocation might not be a choice for Eastleigh workers.

But the spokesman added: "They will be given a lot of practical help to secure other jobs. Between now and the end of next year is a long time frame for people to seek other jobs."