Cheese maker Saputo to close facility in New London

Special to The Freeman

March 27, 2014

MONTREAL – Saputo, Inc. announced it will close two facilities in Canada and two in the United States, including in New London, as part of an effort to increase operational efficiency.

The other facilities slated to close are in Wetaskiwin and Glenwood in Alberta, Canada, and in Hancock, Md.
According to the announcement, the current production will be integrated into other Saputo facilities. The first facility closure is scheduled in May and the final closure will occur in December 2015. A total of 180 employees will be affected by the closures, according to Saputo. They will be provided with severance and outplacement support and some will be offered the possibility of transferring to other Saputo locations, according to the announcement.

“Over the recent years, Saputo has maintained efforts to pursue additional efficiencies and decrease costs while strengthening its market presence. The announced measures are part of the company's continual analysis of its overall activities,” according to the announcement.

Saputo intends to add about $35 million in new fixed assets in other company facilities and will avoid the same amount in capital expenditures that would have been necessary to upgrade affected facilities, according to the company. Costs connected with the closures will be approximately $19.8 million after taxes, which include an after tax fixed assets write down of approximately $14.3 million. These costs will be recorded in the fourth quarter of fiscal 2014. Annual savings after taxes should be approximately $4.8 million and should commence in fiscal 2015.

Saputo produces, markets and distributes a wide array of dairy products, including cheese, fluid milk, extended shelf-life milk and cream products, cultured products and dairy ingredients.

www.saputo.com