TORONTO (CP) — CanGro Foods, which produces fruit and vegetables in cans and jars under the Aylmer, Del Monte and Ideal names, plans to sell or shut two processing plants in Ontario, jeopardizing almost 300 permanent jobs.
CanGro, created two years ago when two American private equity firms took over five Canadian brands from Kraft Canada, said Tuesday the plants in Exeter, north of London, and St. Davids, in the Niagara region, ''will be sold or cease operations by March 31.''
The company said 268 hourly paid employees and 27 salaried staff members could lose their jobs, along with an unspecified number of seasonal workers, if a buyer isn't found.
''CanGro will now shift to outsourcing its canned vegetable and fruit requirements,'' David Hoyles, vice-president of operations, said in a brief statement.
The company did not give a reason for outsourcing its canned food needs, nor did it identify who its future producers would be. Telephone calls to Hoyles were not returned.
Shawn Haggerty, president of United Food and Commercial Workers Local 175, representing the 268 production employees, said the number of seasonal workers affected varies widely but likely approaches 300 — local people, not imported labour.
The company has not made its outsourcing intentions known to the union, which hopes the plants will be purchased and kept in operation, Haggerty said.
''My understanding is that there have been a couple of potential suitors for the plants, but I don't know of any active suitors.''
Tuesday's move follows CanGro's decision last summer to ''enhance productivity and competitiveness'' by shutting a plant that produced canned carrots and beans in Chambly, Que., southeast of Montreal. That closure, effective in November, eliminated 52 hourly and 10 salaried positions as well as 63 seasonal jobs.
In May of last year, CanGro sold the Primo and Aylmer soup brands to Baxters Food Group of Scotland, which transferred production of those products to its plant at St-Hyacinthe, east of Montreal.
CanGro is owned by Sun Capital Partners Inc. of Boca Raton, Fla., and EG Capital Group LLC, a New York private investment firm which took part in the 2004 purchase of chocolate maker Laura Secord.
The assets bought by CanGro from Kraft had about 800 employees when the deal, whose terms were not disclosed, was completed in early 2006.
With the divestment of the vegetable processing facility in Exeter and the St. Davids soft-fruit plant, CanGro would be left with a head office in Toronto, a technical centre in Burlington, Ont., and a tomato and ketchup packing plant at Dresden in southwestern Ontario.
''Sun Capital is known for buying and selling to make a profit, and I believe this is just a time when they believe they can make a profit by shifting business around,'' said the UFCW's Haggerty.
