Kraft Heinz to cut 2,600 jobs, close seven manufacturing plants

Kraft Heinz Company, the new food and beverage giant formed through the merger of Kraft Foods Group and H J Heinz Co in July is cutting 2,600 jobs and closing seven manufacturing plants in North America in order to cut costs.

The move to reduce its workforce by nearly 6 per cent comes three months after the third-largest food company in the US and the fifth-largest worldwide, announced in August that it would cut 2,500 jobs. (See: Kraft Heinz to axe 2,500 jobs in North America)

Kraft Heinz plans to shut down plants located in California, Maryland, New York, Pennsylvania, Wisconsin and Canada and shift production to other plants in North America over the next 12 to 24 months.

Kraft Heinz spokesman Michael Mullen said in a statement that the company will move its Oscar Mayer processed meats business to Chicago from Wisconsin, production from its Davenport, Iowa facility to a new location in the Davenport area and move part of its cheese production from its Champaign, Illinois, facility to other plants.

The merger of Kraft and Heinz, which was completed on 2 July, has created the third-biggest food and beverage company in North America and the fifth-biggest in the world by revenue.

The combination produces more than 200 iconic global brands of food and beverages and sells them in over 200 countries.

Warren Buffet's investment arm Berkshire Hathaway and Brazilian private equity firm 3G Capital had teamed up to buy Heinz in 2013. Collectively, they own 51-per cent stake in Kraft Heinz.

3G is known for its tough cost -cutting measures and layoffs to make the businesses it acquire more profitable. Between April 2013 and December 2014, it had cut over 7,400 positions in Heinz.

Kraft Heinz had said that it expects to save about $1.5 billion in annual costs by the end of 2017.