Typhoo Tea is to close its "ageing" blending and packing site in Moreton in June with the loss of up to 90 jobs.
The company said it is "actively exploring" options for a new site and re-employment, but added that it will be at least one year before a suitable location is ready.
Executive chairman Mike Brehme said: "Unfortunately the spiralling cost of energy and materials, alongside low levels of productivity achievable at the Moreton factory, make it necessary to close the loss-making site.
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"We are actively exploring options for a new site, but it will be some time before a suitable location is identified, fitted out and ready.
"Sadly, we anticipate this resulting in approximately 90 job losses at Moreton.
"I would like to thank all colleagues who have contributed so much in recent, challenging times and we will do all that we can to assist everyone affected by this announcement.
"With the support of third-party packers, we have a robust plan in place to meet the demand for Typhoo products, ensuring supplies to customers continue uninterrupted.
"The regrettable but necessary changes allow Typhoo to realign its ambitions and refocus on the customer whilst ensuring the same high level of service and great quality tea you expect from one of the UK’s oldest and most recognised brands.
"2023 marks the milestone of 120 years of Typhoo Tea. These changes allow us to set the business up for the next generation of discerning tea drinkers."
The company added that the people who remain in the business will relocate to a hub to oversee the day-to-day management of the restructured organisation.
Typhoo Tea was taken over by Zetland Capital Partners in July 2021.
BusinessLive reported in July 2022 that the company said being taken over by a private equity firm will help it focus on its recovery with "new vigour" following an "extremely challenging" 18-month period.
The firm's revenue totalled £54.5m for the 18 months to September 30, 2021, while its pre-tax losses were £10.4m.
Those figures compare to the £53.1m in revenue it reported for the 12 months to March 31, 2020, and the pre-tax losses of £15.8m.
The company's brands also include Glengettie, Ridgeways, Heath & Heather, London Fruit & Herb, Lift, Melroses, Freshbrew and Red Mountain.
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