Burton's Foods is to close one of its biscuit factories in the UK with the loss of around 342 jobs.

The Jammie Dodgers maker said today yesterday that the move is part of a business review the firm is carrying out in a bid to "improve the business' capabilities and cost competitiveness". The firm said it is also responding to an "increasingly challenging and competitive environment".

As a result of the closure, the company said it will outsource chocolate refining at Moreton, subject to commercial viability. It will also consolidate its Knowsley multi-site distribution operations into a single new location.

A GBP7m (US$11m) investment will also be made at the firm's Edinburgh and Llantarnam sites to develop its chocolate biscuit manufacturing capability.

The investments form part of a GBP25m three-year capital spending programme to build production, Burton's insisted. The programme, the company said, would allow it to retain the manufacture of the vast majority of its products in the UK.

Ben Clarke, CEO of Burton's Foods, said: "Today's announcements recognise the need to transform our supply chain. The proposed job losses are deeply regrettable but, along with the new GBP25m investment we are making in our UK manufacturing capability, will help deliver sustainable profitable growth for the company in a highly competitive and challenging market."

The firm said it will now embark upon a period of consultation with its employees and their representatives.