Keebler Announces Decision to Close Lake Bluff, Illinois Bakery.
James T. Willard, Senior Vice President - Operations, said, "The decision to close the Lake Bluff bakery was a difficult one due to its impact on our employees and their families. We are committed to make every reasonable effort to lessen the impact on affected employees by providing a package of severance benefits that includes career counseling, a Job Fair and assistance in finding other employment."
Mr. Willard said the reason for the Lake Bluff closing is excess capacity within Keebler's 17-plant manufacturing network. "This decision will increase the utilization of Keebler's existing baking assets and increase system-wide efficiency as Lake Bluff production is transferred to other production facilities," he said.
The Lake Bluff closing is a result of an on-going system-wide operations analysis that began in September 1998, in conjunction with the acquisition of President International, Inc. ("President"). As part of this operations review process, Keebler also announced in May 1999 the closing of its Sayreville, New Jersey bakery.
The Lake Bluff facility, which was built in 1967, is one of eight bakeries that were part of President Baking Company. Over the past year, President facilities have been integrated within Keebler's production and distribution network. Products and brands produced at the Lake Bluff facility include Olde New England brownies and Plantation cookies.
Lake Bluff Bakery Director James M. Mulholland said, "We regret the circumstances that have led to this decision and appreciate the contributions that Lake Bluff employees have made over the years. We are hopeful that our career assistance programs, coupled with a low local unemployment rate, will enable most employees to return to the workforce quickly."
The costs associated with this closure were recognized in the accounting for the acquisition of President. Savings are anticipated at $4.2 million on an annualized basis.
Keebler, founded in 1853, is the second largest cookie and cracker manufacturer in the United States with the last trailing twelve-month net sales of $2.7 billion. Keebler markets its products under well-recognized brands such as Keebler, Cheez-It, Carr's, Ready Crust, Famous Amos, Murray, and Plantation. Keebler is also a leading manufacturer for both the private label and foodservice markets. Through its Little Brownie Baker subsidiary, Keebler is also a leading licensed supplier of Girl Scout Cookies. Keebler Foods Company is headquartered in Elmhurst, Illinois. For additional information, please visit the Keebler Web site at http://www.keebler.com.
Statements contained in this press release that are not historical facts are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ from those projected. Other factors that may cause actual results to differ from the forward-looking statements contained in this release and that may affect the company's prospects in general are described in the company's filings with the Securities and Exchange Commission.