TORONTO - Canada Bread Company Ltd. plans to close three Toronto bakeries and move their production to a new plant somewhere in southwestern Ontario by 2013 under a $125-million revitalization plan announced Tuesday.
A spokeswoman for Canada's largest breadmaker said the company hopes the existing 435 employees will find new positions both at the new location and elsewhere at Canada Bread, a subsidiary of Maple Leaf Foods Inc. (TSX:MFI).
About 300 of the existing jobs will be moved to the new bakery, while further jobs could end up elsewhere in the Greater Toronto Area, the company said.
"Maple Leaf has 13 plants across the GTA so we will be looking to place employees at other opportunities within the network of operations that we have here," said Jeanette Jones in an interview with The Canadian Press.
"For anyone that's not looking to make the move, we will ensure they're treated fairly and respectfully and obviously with severance and benefits protection in excess of the provincial and employment standards."
The site for the new bakery -- which Canada Bread says would be the largest in the country -- hasn't been chosen but the company expects to make a final decision on the location by the end of March.
Canada Bread -- which makes bread, buns, rolls, bagels and other baked products under the Dempster's brand -- will begin negotiations with several municipalities this week, Jones said.
The company said it expects to begin construction on the new bakery within six months of securing a location and have the first production lines commissioned about a year after that.
"It will drive significantly improved efficiencies in our manufacturing and supply chain, providing the capacity to support organic growth and the growing needs of our customers," Canada Bread president and CEO Richard Lan said in a release.
The cost includes a $100-million capital investment on land, as well as building and equipment. The company will take a separate $25 million restructuring charge for decommissioning production and employee severance payments.
The company, a publicly traded subsidiary of Maple Leaf Foods Inc. (TSX:MFI), has a total of about 8,500 employees in North America and the United Kingdom.
The closure of a Toronto-area bakery is expected in late 2011, the second will be in 2012 and the third in 2013.
