General Mills’ Move To Shut Down Five Facilities Will Cost At Least $120M
General Mills said Thursday that it would sell or close five of its manufacturing facilities, a move that puts 1,410 jobs on the line and is expected to cost the company at least $120 million in severance payments and related charges.
Two of the plants are located in the U.S. The Golden Valley-based food company said it would shut down its Vineland, New Jersey plant, which was the original Progresso Soup plant. Approximately 370 employees are expected to lose their jobs.
In a regulatory filing, General Mills said it would take an $11 million loss in a definitive agreement to sell its Martel, Ohio plant to Mennel Milling Company. General Mills is expected to receive $18 million in the next year or so, pending negotiations with union officials.
A General Mills spokesperson told the Star Tribune that the 180 employees at the Martel location were being considered for reemployment at the plant, which had been manufacturing dry baking mix products since 2001.
The food company’s restructuring efforts also reach outside of the U.S.
General Mills’ manufacturing and distribution facility in Marilia, Brazil will close along with its production transfer operations in Sao Bernardo do Campo. The company is actively negotiating with union officials at both locations to determine severance packages for the 420 affected workers.
In China, General Mills will be exiting the fruit snacks business and ending production of Trix products at its Nanjing plant. The company will continue to make Bugles snacks, although this will still result in the elimination of 300 positions.
Between its international operations, General Mills is estimating to incur $42 million in charges related to employee severance packages and writing down its assets. Similar losses will occur in regards to its Vineland location, however, the company expects those charges to total $67 million.