US meat major Tyson Foods has agreed to sell a poultry processing complex to local poultry producer House of Raeford Farms.
Financial details were not disclosed.
Tyson Foods said it decided to sell the facility in Vienna, Georgia as “part of its continued efforts to optimise its plant network”.
North Carolina-based House of Raeford Farms will acquire the site and it “intends to continue poultry processing at the complex utilising the existing workforce and grower network”, according to a statement.
Meanwhile, Tyson Foods will continue to serve customer orders from other production facilities, it added.
Founded in 1955, House of Raeford Farms is a family-owned business that supplies frozen and ready-to-cook products, deli meats and fully cooked chicken products to US foodservice and retail customers. The company also ships products outside the US. Its brands include House of Raeford, Speedy Bird and Filet of Chicken.
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By GlobalData
The deal follows a series of plant closures from Tyson in recent quarters.
In March, the company announced it would permanently close a pork plant in Iowa, affecting 1,276 employees.
Last November, the group set out plans to shut two of its case-ready meat production facilities. The sites affected were in Jacksonville, Florida, and in Columbia, South Carolina.
Three months earlier, Tyson said it would close four domestic chicken factories in light of slowing demand and a drop in profits. The plants affected included two in Missouri and one each in Indiana and Arkansas.
Before that, Tyson said it would shut two poultry plants in Virginia and Arkansas, which, combined, employed more than 1,600 people.
Following Tyson’s second-quarter results which were announced in May, the business raised its guidance for adjusted operating income on the basis of an improving outlook for the chicken segment of its protein portfolio.
Chicken sales fell 8.2% in the second quarter to $4.06bn. CFO John Tyson explained the volume decline was “driven by lower production as we better aligned our supply to customer demand”, even as prices were cut 2.1%.
Tyson Foods raised its outlook for adjusted operating income (AOI) for chicken to $700-900m, from the $500-700m provided at the first-quarter results announcement in February.
