Convenience food group Greencore is to move its East Coast operations in the US from two manufacturing facilities in Massachusetts to a new £20 million (€23.8 million) premises in Rhode Island.
The London-listed company is building the new factory in an effort to extend its reach into the New York market while continuing to serve its existing markets in New England, it said in a statement.
Around 370 people will be employed at the 9,000 square-metre factory when it opens in spring next year, producing a range of sandwiches, salads, parfaits, snack boxes and quiches. Employees currently working at the two Massachusetts facilities will be offered an opportunity for transfer.
The group has been attempting to grow its manufacturing and distribution base in the US since a deal last year to supply sandwiches to coffee-shop giant Starbuck’s. It also supplies the 7-Eleven chain of convenience stores.
Greencore chief executive Patrick Coveney said the project marked an "important milestone" in the company's effort to grow business in the US.
“This investment will significantly enhance our capability and capacity to serve the sandwich market in the North Eastern region of the US, and will also enable us to drive further growth with current customers,” he said.
“Delivering this project will represent an important milestone as we continue to build a strong, growing, profitable food to go business in the USA.”
The news follows an announcement last month that the company is to invest $10 million (€7.3 million) in its facility in Jacksonville, Florida. It has also recently acquired US food to go manufacturer Lettieri’s for an undisclosed sum.
As the world’s largest sandwich manufacturer, Irish-owned Greencore produces 450 million sandwiches every year, in addition to ready-meals, soups and sauces, cakes, desserts and Yorkshire puddings. The group is one of the leading convenience food manufacturers in Ireland and the UK, with a fast-growing food to go business in the US.
The stock market responded well to today’s announcement, with shares closing up 1 per cent at £269.50.
The company will write down assets valued at £8 million for the 2014 financial year as a result of the closure of the Newburyport and Brockton factories, as well as cash exit and start-up costs of an estimated £3 million. These costs will be reported as exceptional items, the company said.
The £20 million cost of the new Rhode Island facility will be incurred by the company over the next 15 months.
