WORKERS were celebrating last night after more than 400 jobs were saved at a North-East frozen desserts factory.

Staff at Hibernia Foods in Stockton had faced redundancy after the company went into receivership in October.

But administrators KPMG announced yesterday that the factory on the Preston Farm industrial estate had been sold to Leeds-based Country Style Foods for an undisclosed sum and all the jobs were safe.

For Hibernia Foods workers elsewhere there was less welcome news. Thirty-five administrative staff were made redundant at the company's head office in York and 500 jobs were lost at the Bridlington factory, which makes Sara Lee desserts.

Joint administrative receiver Myles Halley said: "The sale of the Hibernia business at Stockton is good news for the 400 employees.

"But, despite extensive efforts and negotiations with a number of interested parties over the last two months, we are unable to conclude a sale of the Bridlington business, and today we have taken the difficult decision to close the factory down and make the employees redundant."

Dublin-based Hibernia operated six sites in the UK, including three factories in the North-East, and employed about 2,000 staff when it entered administration.

Since then, 590 jobs have been saved in Hartlepool after Irish food firm Kerry Group bought the company's ready meals business at Brenda Road and Freshbake Foods took over the frozen desserts factory at Oakesway.

Country Styles Food chairman Tony Wood said that everyone at the Stockton factory would keep their job. "We are looking forward to working with them and hoping they'll all be back to work in the next day or two," he said.

Stockton Borough Council leader Bob Gibson said: "We are highly delighted at this outcome.

"This must have been a very worrying time for the workforce, especially over the Christmas period. Hopefully now this is all in the past."