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Safeway to unveil further cutbacks

Chris Hughes
Tuesday 06 July 1999 18:02 EDT
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SAFEWAY, the troubled food retailer, is to reveal it is making further job cuts at its annual general meeting on Tuesday.

Kevin Hawkins, Safeway's spokesman, said: "As part of our ongoing reorganisation of the retail chain, we have taken out a regional tier. Some people will be relocated elsewhere but at the end of the day there may be a few people who we may not be able to slot in."

The group is to scrap its structure, which is currently based on four regions, London and the South-east, Scotland, the Midlands and the South- west. Each divisional office employs 12 to 20 people. In addition is to close its London-based trading office, entailing some job losses. The group declined to indicate the scale of the losses. However, they are understood to total around 150 and include senior staff who have been with the company for many years.

The announcement at the AGM is expected to be accompanied by a disappointing trading update. Safeway's shares have fallen from 426.5p in 1997 to a recent low of 235p. As the shares hovered around the 400p last year it entered talks on a "merger of equals" with Asda, since taken over by US giant Wal-Mart.

"This is part of something that has been going on for some time," said Mr Hawkins. "It has nothing to do with Wal-Mart."

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