Major Vancouver, Canada based organic and natural/non-GMO foods manufacturer SunOpta pulled a major surprise in mid-2017 when it announced it has signed a definitive agreement to sell equipment used in the production of flexible, re-sealable pouches from its Allentown, PA facility to Skjodt-Barrett for $2.0 million, expected to close during the fourth quarter of 2017.
The asset sale is in conjunction with the company’s decision to discontinue flexible, re-sealable pouch products as part of its ongoing portfolio optimization strategy and "Value Creation Plan".
“I want to thank all of our employees involved in the flexible re-sealable pouch operations for their hard work and dedication. This asset sale, and discontinuation of the flexible re-sealable pouch business aligns with our stated portfolio optimization strategy of exiting product lines where the company is not effectively positioned,” said Dave Colo, CEO of SunOpta.
“We anticipate the discontinuation of contract manufacturing pouched baby food products to be profit neutral and allow for the redeployment of capital and resources for investment in more profitable segments of our business where we have enhanced strategic positioning.”
Flexible re-sealable pouch products accounted for $46 million of revenues in fiscal 2016, and $10 million of revenues in the first quarter of 2017, and were part of the healthy snacks platform within the consumer products segment.
SunOpta will continue to produce aseptic beverages from its Allentown, PA facility, which were not part of the sale.