One of the north-west's biggest industrial employers is expected to confirm today that it is ceasing operations in Ireland with the loss of nearly 300 jobs.

The president of Unifi Textured Yarns (Europe) Ltd, Mr Fintan McGrath, will outline the company's position at a press conference in the factory in Letterkenny this afternoon. Yesterday, day shift workers were informed of plans to wind down the firm over the next two months.

The US-owned company was once a flagship industry in Donegal and employed more than 780 people at its peak. It manufactures textured yarn which is found in home furnishings, clothing, and industrial fabrics.

However, increased competition from Asian competitors and rising fixed costs in Ireland have led to increased difficulties in recent years. In April 2003, Unifi announced it was shedding 250 jobs and there were further cuts of over more than 130 earlier this year.

The Tánaiste and Minister for Enterprise, Ms Harney said she was dismayed at the sudden announcement by Unifi that it is to close its Donegal facility.

"Every effort has been made to safeguard the future of these jobs and today's announcement comes as a genuine surprise to all of us who have been involved in that effort," she said.

News of the impending closure has provoked considerable local reaction. Last night Donegal back-bench TD Mr Niall Blaney called on the Taoiseach, Mr Bertie Ahern, to remove MsHarney from her position.

Meanwhile, the president of Letterkenny Chamber of Commerce and Industry, Mr Eamonn Stevenson, expressed his "deep disappointment" at the news.

Calling for immediate action from the relevant agencies, he said a structured approach is needed to tackle the "blatantly obvious employment crisis" in the county.

Donegal has lost over 5,000 textile jobs in the past eight years in firms such as Fruit of the Loom, Comer Yarns Ltd, Nena Models, Herdmans and the Donegal Shirt Company.