SunOpta Inc. Announces Exit from Flexible Re-Sealable Pouch Products
28 July 2017
SunOpta Inc., a leading global company focused on organic, non-genetically modified and specialty foods, announced today that it has signed a definitive agreement to sell equipment used in the production of flexible, re-sealable pouches from its Allentown, PA facility to Skjodt-Barrett for $2.0 million. The asset sale is in conjunction with the Company’s decision to discontinue flexible, re-sealable pouch products as part of its ongoing portfolio optimization strategy and Value Creation Plan.
“This asset sale, and discontinuation of the flexible re-sealable pouch business aligns with our stated portfolio optimization strategy of exiting product lines where the Company is not effectively positioned,” said Dave Colo, CEO of SunOpta. “We anticipate the discontinuation of contract manufacturing pouched baby food products to be profit neutral and allow for the redeployment of capital and resources for investment in more profitable segments of our business where we have enhanced strategic positioning.”
Flexible re-sealable pouch products accounted for $46 million of revenues in fiscal 2016, and $10 million of revenues in the first quarter of 2017, and were part of the healthy snacks platform within the consumer products segment. SunOpta will continue to produce aseptic beverages from its Allentown, PA facility, which were not part of the sale. The sale of equipment is expected to close during the fourth quarter of 2017.
“I want to thank all of our employees involved in the flexible re-sealable pouch operations for their hard work and dedication," Colo said. “Each employee has contributed to our goal of bringing well-being to life in their own way and has had a meaningful impact at SunOpta.”