The Colman's mustard factory is set for a �2.6m overhaul – but owners Unilever say the upgrade may see 20 jobs lost at the historic Norwich plant.

The investment – the largest since Unilever acquired Colman's in 1995 – is aimed at improving efficiency and capacity at the Carrow site as part of the firm's growth targets.

Mustard production at the site dates back to 1865, with wholegrain and English mustards currently manufactured there, along with the Colman's range of sauces, powdered condiments and Jif Lemon.

While it is not aimed at bringing new product lines to the factory, which employs about 170 people, the investment is set to improve the capabilities at the site.

But Unilever said the work could result in 20 job cuts, with consultations with staff under way.

Colman's is one of the oldest existing food brands, founded by Jeremiah Colman in 1814, who produced mustard from a mill in Bawburgh before shifting production to Norwich.

A Unilever spokesman said: 'Last month Unilever informed employees at its Norwich factory of plans to improve the competitiveness of the site as a part of the company's growth ambitions.

'As part of this plan, we have committed to investing about �2.6m to upgrade and expand the production capabilities we have at the factory which will be critical to support the future growth of the business. We anticipate that this upgrade will be completed by mid-2012.

'However the changes mean that there may be a reduction of approximately 20 roles on site.

'We have now entered a period of consultation with our employees and their representatives, and will continue to communicate and engage with them in a timely way as we seek to implement these changes.'

Unilever is one of the world's biggest owners of consumer brands with a portfolio of products including Knorr, Hellman's, Dove, Lipton and Flora.

Glenn Holdom, regional organiser of the GMB union, which represents a number of staff at the Colman's site, said the union would be 'engaging' with the company to help avoid compulsory redundancies.

sam.williams@archant.co.uk