The company announced the closures and layoffs as part of a plan to consolidate and streamline its pork business. The company plans to save $125 million a year by 2011.
Plants slated for closure include Smithfield Packing Co. plants in Smithfield, Va.; Plant City, Fla.; and Elon, N.C.; a John Morrell plant in Great Bend, Kan.; a Farmland Foods plant in New Riegel, Ohio; and an Armour-Eckrich Meats factory in Hastings, Neb. The plants are expected to close by December, the company said.
Smithfield will combine seven of its independent operating companies into three main units: The Smithfield Packing Co., John Morrell & Co. and Farmland Foods Inc. In an additional move, John Morrell and Farmland will combine their sales forces.
C. Larry Pope, CEO of the Smithfield, Va.-based company, said Smithfield was switching its focus from “opportunistic acquisitions of high-quality companies at distressed prices” to being more efficient. He said the company would focus on growth of its high-margin packaged meat business.
“This plan will create true synergies between our independent operating companies and produce more opportunities to improve the bottom line in the future,” Pope said. “Combined with the several plant closures we have made during the past three years, this restructuring should improve operating rates dramatically, allowing us to shed low-margin business.”
The company said it would offer transfers to some employees.
“Layoffs and plant closings are difficult but necessary decisions,” Pope said. “We know that this will create adversity for the employees affected, and we will work with union officials and others to determine how we can provide assistance to our employees to find future employment.”
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