(Corrects third para quote to make timeline clear)
July 25 Tyson Foods Inc said it will
discontinue operations at three of its factories which make
processed meat products such as sausages and hot dogs, affecting
about 950 people.
The largest U.S. meat processor, which won the bidding war
for Hillshire Brands Co in June, said the closures were
not related to the acquisition.
"The closings were under consideration long before our
decision to pursue Hillshire Brands", Tyson spokesman Gary
Mickelson told Reuters.
Tyson outbid Pilgrim's Pride Corp with its $63 per
share offer for Hillshire, valuing the Jimmy Dean sausages maker
at $8.55 billion.
The closures were due to changing product needs, an aging
Cherokee, Iowa factory and the distance of the Buffalo, New York
and Santa Teresa, New Mexico plants from their raw material
supply base, the company said on Friday.
"The consolidation helps them get transportation
efficiencies," Chris Hurt, an agricultural economist with Purdue
The number of beef cattle in the United States is at its
lowest level in 63 years due to severe droughts, reducing the
amount of meat available to process.
The Cherokee factory will close on Sep. 27, while the other
two are expected to stop operating in the first half of 2015.
The U.S. Department of Labor's Occupational Safety and
Health Administration had cited the Buffalo factory for
workplace safety hazards last November and proposed fines of
about $122,000. (1.usa.gov/1xd7EVs)
Tyson contested the citations and settled the case in May,
agreeing to pay $105,000 in fines.
The closures will affect 450 employees at Cherokee, 300 at
Buffalo and 200 at Santa Teresa. The company had about 115,000
employees as of last September.
Shares of the company, which will report quarterly results
on Monday, were little changed at $39.49 in extended trading on
(Reporting by Sruthi Ramakrishnan in Bangalore and P.J.
Huffstutter and Tom Polansek in Chicago; Editing by Joyjeet Das)