ConAgra to Cut 1,500 Jobs

ConAgra Foods Inc. on Thursday said it would cut about 1,500 jobs and relocate its headquarters as part of a restructuring plan, as the company is pressured by an activist firm and the packaged-food business experiences broad tumult.

The slashed positions represent 30% of the company's office-based workforce. The restructuring won't eliminate plant positions, the company said.

ConAgra Chief Executive Sean Connolly, called the decisions "difficult but necessary."

ConAgra estimated it will incur total charges of about $345 million in connection with the restructuring over the next two to three years.

The maker of Chef Boyardee and Slim Jim snacks expects to realize more than half of the savings by the end of its 2017 fiscal year, with the balance achieved in 2018.

ConAgra also said it would move its headquarters to Chicago from Omaha, Neb., beginning in 2016. The company plans to maintain some 1,200 employees in Omaha, including some research-and-development and supply-chain-management operations.

"Locating our headquarters and our largest business segment in Chicago places us in the heart of one of the world's business capitals and consumer packaged-goods centers, enhancing our ability to attract and retain top talent," Mr. Connolly said.

ConAgra, under pressure from activist investor Jana Partners LLC, has been seeking a buyer for its struggling private-label business—less than three years after spending $5 billion to buy it.

In July, ConAgra struck a deal with Jana to add two members to its board after Jana disclosed in June that it had built a more than 7% stake in the company.

In September, ConAgra announced a $1.95 billion charge for the private-label unit, which makes foods that supermarkets sell under their own brands. The charge is related to ConAgra's decision to reclassify the private-label unit as discontinued operations because of its plans to exit the business.

In its branded business, which also includes Pam cooking spray, ConAgra has been battling weak demand for many traditional U.S. packaged foods, which also has sapped sales at rivals including General Mills Inc. and Campbell Soup Co.

The food industry has been facing challenges from consumers' shifting tastes to more natural and organic products, as well as a growing preference for fresh food over the shelf-stable items and frozen meals ConAgra makes.

Write to Ezequiel Minaya at [e-mail]

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(END) Dow Jones Newswires

October 01, 2015 08:55 ET (12:55 GMT)

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