Thursday, August 9, 2012

More layoffs attributable to Flaherty's income trust tax

E.D. Smith remained a Canadian owned and controlled company (income trust) for less than a year after Flaherty's income trust tax, a tax which destroyed its value and restricted its access to capital, making it ripe for takeover by US TreeHouse Foods, which is exactly what happened.

Now we learn that 180 Canadians will lose their jobs as TreeHouse Foods shifts production from Winona Ontario to TreeHouse operations in Pennsylvania.

Seaforth Creamery Closure Will Put 180 Out of Work

Posted by: i on Stratford Staff  Tags:   Posted date:  August 8, 2012 

The Seaforth Creamery will close in early 2013 putting 180 people out of work.
Treehouse Foods is the parent company of E.D. Smith which owns the Seaforth plant. Spokesperson Ron Bottrell says the decision was based on economics and an aging facility and the operations will be moved to other plants that make like products.
There is a plant in Winona, Ontario, and one in northeast Pennsylvania.  The closing would be the second of it’s Ontario plants to shut its doors within the last four years. The company’s Cambridge facility closed in July of 2009. At that time employees from that plant were moved to Seaforth.
Bottrell says there will be employee support programs set up in the coming months.
The Seaforth Creamery produces salad dressings and marinades.

Treehouse Foods Company Release:
OAK BROOK, Ill., Aug. 8, 2012 /PRNewswire
Production at the Company’s Seaforth, Ontario, Canada salad dressing facility is expected to cease in the second quarter of 2013, with full plant closure expected in the third quarter of 2013.  Total costs to close the Seaforth facility are expected to be approximately $17.3 million or $0.33 per fully diluted share, of which approximately $6.4 million, or $0.12 per fully diluted share is expected to be in cash.  Components of the charges include non-cash asset write-offs of approximately $10.9 million, severance of approximately $4.0 million, and other closure costs of approximately $2.4 million.  The Seaforth Plant has approximately 180 employees.  Production will be moved to other manufacturing facilities within the Company’s existing network.


Anonymous said...

Way to go Jim and everyone who voted for this incompetence. You all have had a part in gutting Canadian industry.

Nice job.


Dr Mike said...

I guess it has become all about the temporary influx of foreign dollars for this gov`t without a thought to the long term consequences & the toll on people`s lives.

It`s one thing to let foreign countries grab up the oil because it is an asset that can`t be moved , but letting head offices of manufacturing flow outward from Canada is a recipe for the loss of jobs.

You sure can`t say these guys in Ottawa are not short-sighted.

I guess to them what are a mere 180 jobs.

Dr Mike Popovich

Anonymous said...

The death of Business trusts have been a neglected sector and not talked about since 2006. That's why we have the CAITI site.

The income trust structure was a way for non resource companies to access efficient capital. Business trusts covered areas like healthcare, hotels, financial specialty services, trucking , entertainment ,media , and utility sectors.

A few examples : your hockey dad hotels like CHIP REIT which managed Travelodges , Delta hotels was taken over by a BC pension management firm. CHIP REIT was denied REIT status because it was an operator, what a joke ! How about our mundane slow growth trucking companies, packaging companies and others. How about allowing our healthcare services companies like diagnostic services , senior and longterm care homes access to efficient capital just like our pension firms. Let alone the tax advantaged sovereign wealth funds. Mr Flaherty hope you enjoy your Blueberry jam every morning !

Because your Income Trust decision made a jam to my pension plan and the 180 layoffs from ED Smith !

Coupon Clipper Revolt !