FINSBURY Food Group plc, a leading manufacturer and distributor of speciality cakes and breads, has signed a three-year licensing agreement with the Village Bakery Melmerby, well known in the organic sector.

The agreement is good news for Finsbury's Salisbury subsidiary, Nicholas & Harris, who will produce the organic breads for the Village Bakery brand.

Established in 1976, Village Bakery has been a pioneer in the organic sector and is a widely known organic bread, biscuit and cake producer.

Finsbury, which acquired cakes and speciality breads manufacturer Nicholas and Harris last year, intends to promote the value of Village Bakery's name and expand its offering to supermarkets.

Campbell Mitchell, managing director of Nicholas & Harris, of Brunel Road, Churchfields industrial estate, said the agreement was "very good news indeed".

"The Village Bakery is one of the leading organic brands in the UK and we have worked with them for some years," he said. "This has been formalised with a three-year licensing agreement, covering the whole of the UK, with expansion into Asda and other major supermarkets."

Mr Mitchell said the company employed 114 staff and the agreement could lead to another 12 jobs.