The merger plans between both firms would be unlikely to have a negative impact on the 600 jobs in Cork, Waterford and Dublin provided by the two groups, according to industry sources.

SmithKline Beecham (SKB) employs over 500 people in two manufacturing plants in Ireland. About 300 are employed in the Penn Chemicals plant in Ringaskiddy, Co Cork, where base ingredients for tablets produced by the company are manufactured. A £30 million development has just been completed and the advanced nature of the Ringaskiddy operation means it is unlikely to suffer from any rationalisation that might occur.

A second SKB operation employs about 200 people in Dungarvan, Co Waterford. Sterling Drugs, which was bought by SKB in 1994, is a finishing plant for the manufacture of tablets. No immediate impact is expected but a lot would depend on the decisions taken by any merged group in relation to its tableting facilities.

Glaxo has no significant manufacturing presence here. About 100 people are employed in south Dublin, servicing the Irish market through sales, distribution and a small manufacturing or formulation operation. No negative impact on employment would be expected from any merger.