TreeHouse Foods’ subsidiary Bay Valley Foods is planning to close spoonable dressings production facility in Ayer, Massachusetts.
The company is planning to stop production in the first half of 2017, while the full closure of the unit is expected in the third quarter of 2017.
Ayer facility employs around 100 people and mainly produces regional branded private label spoonable dressings.
The closure has been announced after the ongoing manufacturing network analysis undertaken by the company in order to maintain competitive costs, service levels and product quality.
Following the closure, the company will move the production of Ayer facility to other manufacturing facilities. With this change, the company does not expect supply disruptions to occur.
TreeHouse expects to incur total facility closure costs to be around $5.6m, of which approximately $5.3m is expected to be in cash.
The company expects $1.2m of non-cash write offs, $2.2m as employee related costs and $3.1m of other closure costs.
In February this year, TreeHouse Foods completed the acquisition of ConAgra Foods' private brands operations. For the acquisition, TreeHouse paid $2.7bn in cash plus transaction expenses.
The acquisition of ConAgra's private brands operations is intended to expand TreeHouse's presence in private label dry and refrigerated grocery, and will be called TreeHouse Private Brands. Bay Valley Foods and TreeHouse Private Brands will be the operating platforms of TreeHouse Foods.
The transaction also included transfer of 9,500 ConAgra employees to TreeHouse Foods.
Image: TreeHouse closes spoonable dressings producing facility. Photo: Courtesy of rakratchada torsap/FreeDigitalPhotos.net.
