BEDMAKER Silentnight has announced plans to reorganise its furniture business.

But the reorganisation will not affect the Sunderland-based Homeworthy operation, which employs 700 staff.

Chief executive Nino Allenza said the reorganisation would only affect its branded furniture businesses, which include Ducal and Cornwell Parker.

About £6.5m has been invested in the Wearside operation since 2000. It manufactures furniture for the mail order and catalogue sector.

Last year, Silentnight closed a factory in Keighley, West Yorkshire with the loss of 220 jobs, and transferred production to Sunderland.

The group, which has its headquarters in Barnolds-wick, Lancashire, said it was considering "a wide range of options" to turn around the branded furniture division, which has been hit by operational difficulties and a continuing decline in orders.

Mr Allenza said: "The review will inevitably involve material changes to the way the businesses are operated and, given that they are heavily loss-making at the moment, there will be quite a substantial restructuring.

"However, we cannot say at this time what affect that might have on employment."

The review is expected to be concluded next month.

Silentnight expanded its furniture division by buying Ducal and Cornwell Parker in 2000, but poor trading has continued to hinder its performance.

The division saw turnover fall 21 per cent to £51.7m and operating losses widen from £1m to £4.9m in the six months to August.