The company, which is part of the Woolworths Group, is looking to cease operations at the Lymedale Industrial Estate site later this year, while the Rosevale Business Park operation will become an internet fulfilment site for Woolworths.

The news comes just five months after E-UK acquired rival distributor THE for some GBP 20 million, and a month after it bought book distribution business Bertrams.

A company statement offered: "This difficult decision reflects the outcome of a recent operational review which looked at combining the recently acquired businesses. Where possible, employees will be redeployed by transferring to other roles either elsewhere within the Woolworths Group or at the Rosevale site.

"The Lymedale site is expected to close in September, although redundancies may begin to take effect from the summer. Rosevale will become fully operational as the internet fulfilment site for Woolworths by July 2007. The two sites, which are both in the Newcastle-Under-Lyme area, currently employ 639 people."