One month after it bought the venerable California snack food company, giant Borden said Friday that it will shut down production at the Laura Scudder's plant in Anaheim and lay off 300 workers there.
Laura Scudder's administrative offices and distribution center will remain in Anaheim, Borden spokeswoman Chris Tilton said Friday, but production of Scudder products there will be phased out over the next three months, with most manufacturing activity moving to Borden plants in Albuquerque, N.M., Kaysville, Utah, and Tracy, Calif.
When Borden purchased Scudder's for an estimated $100 million on Sept. 22, Borden spokesman Nicholas R. Iammartino said that plans for Scudder's were "business as usual." So Friday's announcement came as a surprise to most Anaheim-based Scudder's employees.
"What we've discovered is that we will be . . . more than able to continue the snacks production formerly at Anaheim at our other nearby snack-food plants," Tilton said. "Our facilities--especially in Albuquerque and Kaysville--are much more modern and up-to-date."
Scudder's makes tortilla and potato chips, nuts, cheese curls, popcorn, dry dip mixes, caramel corn and peanut butter at the Anaheim plant, Tilton said. The plant employs 632 people, including production workers, administrative personnel and distribution and warehouse workers. It has been in operation since 1960.
Scudder's is the second-largest snack food company in its three-state territory--California, Arizona and Nevada--ranking behind Frito-Lay, and controls a "high-teens market share" in the lucrative California snack market, said food industry analyst William Maguire, of Merrill Lynch Research in New York.
Supervisors at Scudder's broke the news of the layoff to small groups of workers in Anaheim shortly before noon Friday.
"There are a lot of unhappy people in there," said one female visitor as she left the Anaheim plant shortly after the announcement.
"These are people you see in the cafeteria all the time, and it's kind of sad," said a female accounting department employee who has worked for the company for 25 years. The woman, who asked that her name not be used, said that the accounting group won't be affected by the layoff.
George R. Kuper, a Borden vice president in charge of the Anaheim facility, said the company wanted to move manufacturing to its more modern plants that have excess production capacity. "We will now be able to retain a more consistently high quality level."