Kraft might seek incentives, bring jobs to Chicago area
As Kraft Foods prepares to cut about 1,600 jobs and split into two companies, the Northfield-based company said Tuesday it has been exploring state and other government incentive programs on its quest to find new headquarters in the Chicago area.
The new sites could be announced by late March, said Kraft spokesman Michael Mitchell.
Mitchell declined to specify which towns or regions are being considered, saying the company “doesn't want to pit one location against another and raise any false hopes.”
Kelly Jakubek, a spokeswoman for the Illinois Department of Commerce and Economic Opportunity that handles such incentive packages, said they're “in discussions with Kraft” but could not comment further.
Last August, Kraft said it would divide its business into two separate, public companies by late December and wanted both headquarters to be in the Chicago region. The North American grocery business would retain the Kraft name. The other business, global snacks, will be named with shareholder approval during the company's annual meeting in May.
As it works toward that goal, Kraft said Tuesday it will close three facilities, relocate certain operations to the Chicago region, and cut about 1,600 jobs in the United States and Canada.
Kraft's beverages business unit in Tarrytown, N.Y., and the Planters brand in East Hanover, N.J., will both close by December and relocate workers to the Chicago area. Most affected employees will have the option to transfer. Kraft also will close its management center in Glenview by late 2013. The Glenview office has about 900 workers, who will transfer to the new site. Workers will be notified throughout this year about their status, Mitchell said.
“The Chicago area will be the net beneficiary of the positions,” said Mitchell.
Kraft, which also has operations in Aurora, Naperville and Woodstock, said those manufacturing sites are not included in Tuesday's announcement.
Kraft intends to realign its U.S. sales organization, consolidate the U.S. management centers and streamline the corporate and business unit organizations.
“For the past year, the North American team has been working to streamline operations to deliver sustainable top-tier performance and continue to invest in our iconic brands,” Kraft chairman and CEO Irene Rosenfeld said in a statement. “We're confident that this transformational work will improve effectiveness and fuel the future growth of both companies.”
When the North American grocery company is spun off later this year, it will reduce its U.S. management center locations from four to two.
In Canada, both companies will retain sites in the Toronto area. The Kraft grocery business will stay in the current Don Mills offices, while the snacks business moves to recently opened offices in Mississauga. The Madison, Wis., management center will remain the site for the Oscar Mayer brand.