The expiration of a contract that allows the Hormel Foods Corp. to sell the Splenda brand sweetener into the food service category will force the company to close its packaging plant in Perrysburg, Ohio. The Splenda product line is a part of Hormel’s Specialty Foods business unit, and Jeff Ettinger, chairman, president and chief executive officer of the company, said the business unit will be challenged going forward.
“The agreement allowing Diamond Crystal Brands to sell Splenda sweetener into the food service trade channel will expire at the end of June,” Mr. Ettinger said in a conference call with financial analysts on May 23. “Our Specialty Foods segment will be challenged by the loss of these sales in the back half of the year. We also regret to report that this loss of business will necessitate Diamond Crystal’s closing of its Perrysburg, Ohio, plant.”
Mr. Ettinger said the Splenda business is a franchise Hormel Foods has been involved with for a number of years and that the owner of the brand decided to bring the business back in house after the expiration of the contract.
“We had been in discussions with them with hopes to extend that contract,” Mr. Ettinger said. “And ultimately, the decision was made that they wanted to bring it back in-house and go their own route.”
Splenda is a product of Johnson & Johnson, New Brunswick, N.J. McNeil Nutritionals L.L.C. is the global marketer of the brand.
