Under the proposal, Goodman Fielder's meat-processing activities in Hamilton would close, with the work shifting to Heller's sites in Christchurch and Auckland.
There are 125 workers at the site, in the Hamilton suburb of Frankton, and Goodman Fielder chief executive Chris Delaney said the company was consulting with employees affected by the decision.
"We have had to make the difficult recommendation to close the facility at Frankton ... where possible, (staff) will be provided the opportunity for redeployment to fill vacancies at other Goodman Fielder sites across New Zealand and potentially at Hellers.
"Employees who are not able to be redeployed will receive their full redundancy provisions as well as an employee-assistance programme, outplacement programme and careers workshop.
"We understand the impact these decisions can have on our people and our immediate priority is to ensure that our employees are supported through this process," Delaney said.
"Our strategic commitment is to focus our capital and marketing expenditure on our core categories and our meats business is not core to Goodman Fielder. The proposal to sell also reflects the difficult trading environment and market conditions that have existed for the meats business for some time. We explored a number of alternative possibilities; however, none of these were viable which has led to this decision."
The firm said it expected to make $15 million to $17 million from the sale of the two units, which would be used to reduce debt and strengthen the company's financial position.
Subject to consultations with workers, the transactions were expected to be completed on March 31. The divestment of the businesses would mean a non-cash after-tax impairment charge of between $32 million to $36 million as well as an $8 million cash cost.
Delaney said the sale proposals were the "near conclusion of the company's strategy to refocus on its core categories".
APN News & Media
