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.
Business reporter David Bracken came to the N&O in 2004. He covers commercial and residential real estate. Contact David at 919-829-4548 or
Comments
get it right, DOUBT IT
Fri, 07/29/2011 - 15:27 — oleCary1“He just didn’t like the environment in this country and the lack of discipline that the poultry industry had.”
The lack of discipline in the poultry industry, not the WHOLE country.
Your backhanded comment does not negate that real money is leaving this community. I doubt the chicken farmers selling their produce are illegals.And,everyone eats chicken...how can it not be profitable?
"Ukrainian billionaire, Oleg Bakhmatyuk, paid $24.9 million to buy Townsends North Carolina assets out of bankruptcy."
I certainly hope he paid into our state's unemployment system adequately to provide for these workers.
Doubt It
Fri, 07/29/2011 - 14:17 — OlBlueI seriously doubt that the employees at this plant were predominately illegals.The line about "the lack of discipline in this country" should have been a clue. I would like to propose a 1 for 1 swap with Mexico. They send us 1 hard worker and we send them 1 welfare recepient. Kinda like a Student Exchange Program. The Hispanic worker can strive towards citizenship. Our American will see what poverty really looks like, develop a sense of how good they really have it, and come home with a new appreciation for work. Mexico would get their government check and be able to give them about 40%- and they would still live better than the average Mexican family. The United States would benefit from the work provided by one, and give a "push" to the other to get off welfare. Of course, it would be completely voluntary. Bet many would, if they thought they could get some good weed at discount prices.
adios amigos
Fri, 07/29/2011 - 10:41 — outhousecatWow, this is going to put hundreds of illegals out of work. But it should open an extra job or two in the food stamp and welfare department.
Disgusting comment
Fri, 07/29/2011 - 16:11 — aplevineThat is a disgusting and repulsive thing to say about anyone, legal or illegal. 1200 people are not facing unemployment through no fault of thier own. You shoulod be ashamed of yourself. Whether they are here legally or illegally, that is 1200 people that shopped in grocery stores and bought goods and services in the communities they lived in. You are a fool. Shame on you. Shame on you.