Hearthside Food Solutions, a key player in US food manufacturing, is currently navigating Chapter 11 bankruptcy proceedings and plans to shut down another factory.
A Worker Adjustment and Retraining Notification (WARN) submitted to the California Employment Development Department indicates that 175 employees will lose their jobs at Hearthside Food Solutions’ Anaheim plant, which is set to close on 27 April.
Previously, in May of last year, Hearthside Food Solutions disclosed plans to close its snack bars factory in Nashville, Tennessee, resulting in the loss of 229 positions.
In a statement, the contract manufacturer of snack bars, bakery products, and fresh and frozen goods emphasized that its “top priority is supporting all employees during this transition” at the Anaheim facility.
Established in 2009 and based in Downers Grove, Illinois, Hearthside Food Solutions stated: “As such, we announced plans to wind down operations in our Anaheim, California plant.”
The company elaborated: “This winddown period and plant closure will take place over the next several weeks. This difficult decision follows careful consideration of various factors, including market demand, operational efficiency, and costs.”
In November, it was reported that Hearthside Food Solutions had filed for bankruptcy in the US due to struggles with debt refinancing.
The frozen burritos and cracker manufacturer submitted voluntary petitions for prearranged Chapter 11 in the US Bankruptcy Court for the Southern District of Texas after reaching a restructuring support agreement with its shareholders.
Backed since 2018 by private-equity firms Charlesbank Capital Partners and Partners Group Holding, Hearthside Food Solutions highlighted that the restructuring process will allow the company to reduce its debt by more than $1.9 billion and secure $200 million in new equity capital upon exiting Chapter 11.
The organization is also pursuing court approval for $300 million in debtor-in-possession financing to maintain operations throughout the bankruptcy process.
Hearthside Food Solutions stated: “As the leading contract food manufacturer, we are constantly evaluating opportunities to optimise our production network across our packaging segments to better position our company to meet the needs of our customers,” confirming the Anaheim facility’s closure.