The new Ukrainian owners of the North Carolina operations of chicken processor Townsends informed Siler City officials Thursday that they plan to close all the company’s facilities in the state by Oct. 1.
The move, which would put roughly 1,200 people in Mocksville and Siler City out of work and terminate contracts with hundreds of chicken farmers, comes just five months after a Ukrainian billionaire, Oleg Bakhmatyuk, paid $24.9 million to buy Townsends North Carolina assets out of bankruptcy.
As recently as March, an executive of Omtron, the U.S. shell corporation created by Bakhmatyuk, expressed optimism that the company could turn the operations around through cost-cutting and by ramping up exports of dark meat.
David Purtle, Omtron’s CEO and a former Tyson Foods executive, said this morning that Bakhmatyuk decided that he didn’t see a long-term future in the business.
“He just decided to shut it down and take his losses and go on,” Purtle said. “He just didn’t like the environment in this country and the lack of discipline that the poultry industry had.”
Purtle said he never spoke to Bakhmatyuk personally and instead dealt with the billionaire’s representatives.
The poultry business has been under increasing pressure from the rising corn and fuel prices, a mix that ultimately drove Townsends into bankruptcy after more than 100 years of being in business.
Many small and midsize poultry companies have found it increasingly hard to compete.
In May, Omtron laid off 145 employees at a facility in Siler City, saying the operation’s revenues had not kept pace with costs.
Still, Thursday’s announcement shocked officials in Siler City and Mocksville, particularly since Omtron had invested more than $7 million in the Siler City facility since buying Townsends.
“Everybody’s surprised as we are,” Siler City Mayor Charles Johnson said.
Omtron filed a notice with state officials today notifying them that 476 employees will be let go in Mocksville by Oct. 4.
Johnson estimated that about 550 people work for Omtron in the Siler City area.
Purtle said Omtron/Townsends total workforce in North Carolina is close to 1,200.