About 160 jobs will go in Morrinsville when Meadow Mushrooms closes there - but jobs will be created in Christchurch, where the company is expanding.
Chief executive Roger Young said the company regretted the closure and had worked hard to keep the operation going in recent years.
"It has beenin continuous operation for the past 56 years and it is with great regret that we must now close it. We are still discussing the situation with our 160 Morrinsville staff and hope to relocate some of them to Canterbury," he said.
The compost production facility at Taukoro Road will cease operation by December 31 and all mushroom growing will cease at the Avenue Road farm by end of March 2011.
The company has a head office in Canterbury and is owned by the Giles and Burdon families.
Former National Party cabinet minister Phillip Burdon is among the owners.
The company's Morrinsville operation is known as NZ Mushrooms Ltd, and it is one of the biggest employers in Morrinsville.
Meadow Mushrooms is redeveloping and expanding its Canterbury-based activity so it can absorb and expand on the production currently carried out in Morrinsville.
The company did not have any structural damage from the September 4 earthquake in Christchurch.
The Waikato Times reported that neighbours of the company's Taukoro Road composting plant last year successfully opposed resource consents for emissions from the plant, describing the stink as being like "dead cows".
The court found the smell was in breach of existing resource consents, and after compliance requirements were deemed to be too expensive, the company decided both it and the Avenue Road factory would close.
