Two European plants have been slated for closure, under the H.J. Heinz Co.’s ongoing review of its global operations.
Employees there were notified this morning that the Pittsburgh food company plans to close a plant in Turnhout, Belgium, and one in Seesen, Germany. The Belgian operation affects 157 workers, while the German one affects 190.
A company spokesman said this morning that the move is meant to make the Heinz operation more efficient, describing the changes as part of a “comprehensive and ongoing process to review our company’s European supply chain footprint, capabilities and capacity utilization.”
Heinz, which was acquired for more than $28 billion last year by a joint venture of 3G Capital and Berkshire Hathaway, has seen new management looking for ways to cut costs.
Last year, the company trimmed more than 600 office positions in its North American operations, then announced plans to close three plants in North America affecting 1,350 jobs. The company said it would shift production to five existing plants in Ohio, Iowa, California and Canada, adding a total of 470 positions at those sites.
The European operation now seems to be going through a similar process.
Michael Mullen, senior vice president of corporate and government affairs, said the plan there is to shift production to other Heinz factories or co-packers.
“Our proposal to consolidate manufacturing across Heinz Europe, if implemented, would be a critical step in our plan to ensure we are operating as efficiently and effectively as possible to become more competitive in a challenging environment, and to accelerate the company’s future growth,” he said.
The company plan to close the plants requires consulting with unions that represent the employees.
The Turnhout operation makes a range of food-service single portion and bulk sauce packs, according to Mr. Mullen, while the Seesen plant makes Heinz Fridge Packs of beans and pasta. It also makes infant feeding tray meals.
Like North America, the European operation for Heinz represents a significant portion of total sales but has struggled to produce growth in recent years. In addition to a slow economy, the regions can’t match the sales growth found in emerging markets where the middle class is expanding.
In the quarter ended Oct. 27, Heinz Europe reported a 3.2 percent sales drop to $783 million. By comparison, the company’s North American Consumer Products segment saw sales drop 5.9 percent to $748 million, according to regulatory filings.
The region that Heinz defines as “rest of world,” which includes markets such as Brazil and Egypt, produced a sales increase of 3.5 percent to $279 million.
