Mr Buffett and 3G Capital, the private-equity firm founded by Brazilian billionaire Jorge Lemann, previously teamed up to take Heinz private in 2013. That reflects sales at Heinz compared to those after the July merger with Kraft.
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He said the closure decision was made “after thoroughly exploring extensive alternatives and options”.
The plan includes shuttering the almost century-old Oscar Mayer plant in Madison, Wisconsin, which houses the company’s USA meats business.
KRAFT Heinz Co (KHC.O), the maker of Jell-O and Heinz Tomato Ketchup, will close seven factories and lay off about 2600 workers in North America, a company spokesman said.
The new company, Kraft Heinz, announced Wednesday that it would shutter the 96-year-old Madison facility within two years.
The company said it also will shift meat production from its Oscar Mayer plant in Davenport, Iowa, to a planned $203 million plant to be built several miles away.
The agreement will ensure that Kraft-Heinz preserves a significant employment base throughout New York State for years to come and paves the way for additional investment and growth at a number of Kraft-Heinz facilities.
The Kraft Heinz factory in Federalsburg is one of the town’s largest employers, which is saying a lot considering about 2,300 people live in town.
Our partners at the News-Gazette report Kraft will be eliminating jobs at its Champaign plant as a result of moving cheese production operation to other locations.
Investors and analysts will also be interested in details and challenges arising from integrating the two companies, especially if it helps shed light on how soon the combined company will return to acquisition mode, MarketWatch said, naming Mondelez global Inc.
Durham said offering financial assistance to a company that is downsizing is not unique and could become more common as more large companies merge.
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The job cuts, representing almost 6% of the company’s workforce, are the first in the company’s production lines since H.J. Corporate representatives sent an email to 11 News, explaining, in part: “Kraft Heinz fully appreciates and regrets the impact our decision will have on employees, their families and the communities in which this facility is located”.
