In a bid to “restructure” its Canadian frozen pizza business, Dr. Oetker plans to shut its New Brunswick processing plant at the end of May.
The German food firm announced Tuesday it will close the former McCain Foods frozen pizza plant it leases and operates at Grand Falls, about 180 km northwest of Fredericton.
The company said about 70 per cent of the pizza production from Grand Falls will be moved to the new Hub production plant it owns at London, Ont.
The remainder of the production will go to another former McCain plant Dr. Oetker runs at Lodi, N.J., just west of Hackensack.
Dr. Oetker said the retail food climate in which it operates has become “increasingly challenging” in terms of price and cost in recent years.
“There is nothing our Grand Falls employees could have done differently,” Dr. Oetker executive vice-president Cecile Van Zandijcke said in a release Tuesday. “Food manufacturers have been facing severe economic pressures over the last few years and today’s market has become ultra-competitive.”
Dr. Oetker on Tuesday pledged severance for the plant’s employees and medical and dental benefits to the end of 2018, plus a $4 million Grand Falls Community Fund to help with job retraining and economic development.
The Grand Falls and Lodi operations came to Dr. Oetker in 2014 when it bought McCain’s North American frozen pizza business and a two-year licence for the use of the McCain brand name in Canada.
McCain had built and opened the Grand Falls plant to enter the frozen pizza business in 1976, and expanded the plant in 2004.
Dr. Oetker, which makes the Ristorante, Casa di Mama, Giuseppe and Tradizionale pizza brands, put up $113 million to set up its London pizza plant and warehousing operation in 2014.
The company, whose Canadian businesses also include Dr. Oetker baking ingredients and dessert mixes and Shirriff puddings and pie fillings, had previously shipped its frozen pizzas to North America from overseas at a rate of 75,000 pizzas per day. –– AGCanada.com Network