In a sharp blow to northwest Ohio, packaged-food maker ConAgra Foods Inc. announced a restructuring yesterday that will shutter two area plants, laying off 565 workers.
In all, the company plans to close five plants and make other moves that will cut costs by $100 million by 2009, it said.
Closing in January is a plant in Archbold, where 400 employees make Healthy Choice soup and La Choy products, and shutting by the end of 2007 is a Perrysburg Township plant on Glenwood Road off State Rt. 795 that employs 165 workers making pudding products, such as Hunt Snack Pack brands.
The production will be moved elsewhere.
"It's a blow," said Dennis Howell, administrator of the village of Archbold in Fulton County.
"We are not happy to see a good corporate customer leave. Like the mayor said, it's a sad day in our history."
The Archbold closing in particular was surprising, said Jeff Stephens, president of United Food & Commercial Workers Local Union 911, which represents workers at both plants.
He said he was surprised at the Archbold closing because the plant has recently had new product lines and added hiring, leading to speculation it would get work being done at a plant in Milton, Pa.
Instead, that plant will get other work because of the restructuring.
Both affected local plants have veteran workers who earn $15 to $23 an hour, plus about $10 an hour in benefits, he said. Many started there right after high school, Mr. Stephens added.
ConAgra spokesman Melissa Baron said the workers were told yesterday.
"We do want to emphasize the decision does not reflect on our employees there or on the plants' performance," she said. "It was a very difficult decision."
The company, based in Omaha, said its moves were part of its effort "to streamline its manufacturing operations" to achieve profitable growth. Sales for the firm last fiscal year were up to $11.6 billion, but profit fell to $592 million.
ConAgra's overall restructuring plan involves shifting the company's focus to the brands company officials believe have the most potential, such as Healthy Choice, Chef Boyardee, and Egg Beaters. The company this year sold its refrigerated meats, seafood, and cheese businesses, including well-known brands such as Butterball, Armour, and Decker.
The firm, the third-largest U.S. food company, said it would build a factory in Fort Worth, Texas, and shift work from other factories, including Archbold and an older Fort Worth plant that will close.
Also shutting are a Folcroft, Pa., plant and a taco shell factory in Laval, Que. In all, the company will have a net loss of about 400 workers because of hiring done at the new plant and those with added work.
The firm previously said it might close up to 12 factories, and yesterday it said more closings will be announced later.
The Archbold plant was opened in 1942 by La Choy, whose Detroit factory was commandeered to make munitions during World War II. It has been owned through the years by Beatrice Foods, Hunt-Wesson, and ConAgra, but old-timers still call it the LaChoy plant, said Mr. Howell, the village administrator.
Local officials are particularly concerned about the work force, 137 of whom have 21 or more years of seniority, but they're trying to stay positive. "We still have 6,000 jobs in a village of 4,500 people," Mr. Howell said.
From Perrysburg Township, pudding production will be shifted to plants in Waterloo, Iowa, and Menomonie, Wis.
John Hrosko, township administrator, said ConAgra officials praised the plant's work force and assured him the decision was solely due to economics.
"They've been a good neighbor," he said.
Mr. Stephens said the union will negotiate with the company on a severance package.
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