A MANUFACTURER that laid off workers last year has announced it is to invest £5m in its North-East site.

Veriplast International, formerly known as Mono Containers, has built an improved production facility and bought machinery for its factory on the Dragonville Industrial Estate, near Durham City.

General manager Steve Granville said: "The company has completely reorganised, restructured and re-focused its efforts."

The group has traditionally operated in two markets - Autobar Packaging supplied containers such as cream cups for the dairy industry, while Veriplast manufactured disposable cups for vending machines.

The restructuring means Durham is no longer involved in the dairy operation and this resulted in 55 redundancies last year.

But Mr Granville said the job losses - fewer than the 83 originally anticipated - were necessary.

"Veriplast has always held up the packaging side," he said.

"With increases in the prices of raw materials for dairy packaging, we were running into trouble fast and I couldn't allow it to continue.

"We always envisaged that, within a short period of time, we would be knocking on doors and asking those people to come back to work for us."

The revamped packaging wing has already won contracts to supply clear plastic salad boxes to fast food vendors Burger King and KFC.

It is also providing poultry trays to Faccenda, the UK's largest meat and poultry supplier.

The new machinery triples the plant's cup-making capacity to a billion units a year. Workers are being sent to other Veriplast plants in Italy and France for training.

Mr Granville funded the improvements by cutting the plant's warehouse space by a quarter and selling the older buildings on the site to form part of a retail park.

As part of the changes, the management structure was overhauled with Mr Granville, who has been with the company for two years, appointed general manager.

Tom Ormerod has been brought in as sales manager.

Mr Ormerod said: "We have really focused our product strategy towards vending and food service disposables.

"This investment will see the Durham site substantially increase its plastic production capacity to further improve supply to our customers."

Mr Granville said: "Merging with Autobar Packaging means we can operate as one, integrated business with a leaner management structure.

"We are confident that the investment and employee training plans will contribute significantly to Veriplast International's business success in 2005."

Published: ??/??/2004