Up to 400 jobs will be lost when Japan-based high-end casual clothing company, Sankyo Seiko, closes down the Scotland production unit of the British DAKS clothing brand.

Sankyo has decided to shut the DAKS Simpson Ltd plant at Larkhall at the end of production for the spring-summer 2002 season in an effort to cut fixed costs.

A loss of £7 million is expected from the closure. Its effect on consolidated earnings for the fiscal year to March 2002 will be announced with the first half results, due to come out at the end of November.

Sankyo plans to sell the Larkhall production unit and to try to find new employment for the company's 400 workers.

The closure marks the end of a two-year fight to save the plant after Marks & Spencer transferred a multi-million pound contract to cheaper foreign manufacturers.

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