ConAgra to Cut 1,500 Jobs
October 01 2015 - 09:10AM
Dow Jones News
ConAgra Foods Inc. on Thursday said it would cut about 1,500
jobs and relocate its headquarters as part of a restructuring plan,
as the company is pressured by an activist firm and the
packaged-food business experiences broad tumult.
The slashed positions represent 30% of the company's
office-based workforce. The restructuring won't eliminate plant
positions, the company said.
ConAgra Chief Executive Sean Connolly, called the decisions
"difficult but necessary."
ConAgra estimated it will incur total charges of about $345
million in connection with the restructuring over the next two to
three years.
The maker of Chef Boyardee and Slim Jim snacks expects to
realize more than half of the savings by the end of its 2017 fiscal
year, with the balance achieved in 2018.
ConAgra also said it would move its headquarters to Chicago from
Omaha, Neb., beginning in 2016. The company plans to maintain some
1,200 employees in Omaha, including some research-and-development
and supply-chain-management operations.
"Locating our headquarters and our largest business segment in
Chicago places us in the heart of one of the world's business
capitals and consumer packaged-goods centers, enhancing our ability
to attract and retain top talent," Mr. Connolly said.
ConAgra, under pressure from activist investor Jana Partners
LLC, has been seeking a buyer for its struggling private-label
business—less than three years after spending $5 billion to buy
it.
In July, ConAgra struck a deal with Jana to add two members to
its board after Jana disclosed in June that it had built a more
than 7% stake in the company.
In September, ConAgra announced a $1.95 billion charge for the
private-label unit, which makes foods that supermarkets sell under
their own brands. The charge is related to ConAgra's decision to
reclassify the private-label unit as discontinued operations
because of its plans to exit the business.
In its branded business, which also includes Pam cooking spray,
ConAgra has been battling weak demand for many traditional U.S.
packaged foods, which also has sapped sales at rivals including
General Mills Inc. and Campbell Soup Co.
The food industry has been facing challenges from consumers'
shifting tastes to more natural and organic products, as well as a
growing preference for fresh food over the shelf-stable items and
frozen meals ConAgra makes.
Write to Ezequiel Minaya at ezequiel.minaya@wsj.com
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(END) Dow Jones Newswires
October 01, 2015 08:55 ET (12:55 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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