Greif to close two facilities, impacting 140 jobs, due to cost increases and declining demand. Production to cease by mid-2025.
Quiver AI Summary
Greif, Inc., a leader in industrial packaging, announced the decision to permanently close its Number 1 Paperboard Machine in Austell, GA, and the containerboard and uncoated recycled paperboard mill in Fitchburg, MA, leading to a total impact on approximately 140 employees. President and CEO Ole Rosgaard cited rising costs and a decline in demand for products in the furniture, book, and binder markets as key factors behind these closures. The company plans to cease production at the Austell location by the end of March 2025 and at Fitchburg by May 2025, which will collectively reduce its containerboard capacity by 100,000 tons and uncoated recycled paperboard capacity by 90,000 tons. Greif remains committed to supporting affected employees with severance and outplacement assistance as these strategic actions aim to enhance efficiency and profitability within their operations.
Potential Positives
- Greif is taking strategic actions to refine its market participation, which suggests a focus on improving long-term profitability.
- The decision to close underperforming facilities reflects a proactive approach to managing operational costs in a challenging market environment.
- By providing severance benefits and outplacement assistance, Greif demonstrates a commitment to supporting affected employees and maintaining company reputation.
Potential Negatives
- Permanent closure of the containerboard and uncoated recycled paperboard mill in Fitchburg, MA, indicates significant contraction in production capacity, potentially impacting market presence.
- Layoffs affecting approximately 140 employees may harm company reputation and employee morale, as well as community relations.
- Ceasing production due to declining demand and increased costs suggests potential long-term challenges in maintaining profitability and competitiveness in key markets.
FAQ
What recent changes has Greif announced regarding its production facilities?
Greif will permanently cease production at the Number 1 Paperboard Machine in Austell, GA, and close the Fitchburg, MA mill.
How many employees will be affected by Greif's closures?
Approximately 140 positions will be impacted by the production ceases in Austell and Fitchburg.
What are the reasons behind the closure of the Fitchburg mill?
The closure is due to high operating costs and the need for significant capital investment amidst declining demand.
When will the production at the affected facilities cease?
Production on the A1 asset is expected to end by March 2025, and the Fitchburg mill by May 2025.
What support is Greif providing to its affected employees?
Greif is offering severance benefits and outplacement assistance to help employees navigate the transition.
Disclaimer: This is an AI-generated summary of a press release distributed by GlobeNewswire. The model used to summarize this release may make mistakes. See the full release here.
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Full Release
DELAWARE, Ohio, Jan. 29, 2025 (GLOBE NEWSWIRE) -- Greif (NYSE: GEF, GEF.B), a global leader in industrial packaging products and services, announced today it will permanently cease production on the Number 1 Paperboard Machine (A1) in Austell, GA and permanently close the containerboard and uncoated recycled paperboard (URB) mill in Fitchburg, MA.
“Decisions like these are extremely difficult because of the impact it has on our colleagues and their families, as well as the larger community,” said President and CEO Ole Rosgaard. “We are grateful to our colleagues in Austell and Fitchburg for their contributions to the company and are committed to helping them navigate next steps by providing severance benefits and outplacement assistance.”
In total, approximately 140 positions will be impacted. Ceasing production at A1 – a non-integrated URB asset for the company - is a result of increased cost and declining demand in its major end use markets of furniture, books, and binders. The combination of high operating costs and the need for significant capital investment were the determining factors in the decision to close the Fitchburg mill. Together, these actions will reduce the containerboard capacity of Greif’s mill network by 100,000 tons, and URB capacity by 90,000 tons.
“We believe strongly in the fundamentals of our business. These strategic actions will refine our participation in the market and help us maximize the profitability of our mill network and our overall business portfolio” said Rosgaard. The company expects to cease production on the A1 asset by the end of March 2025 and Fitchburg by May 2025.
About Greif
Greif is a global leader in industrial packaging products and services and is pursuing its vision: being the best customer service company in the world. The Company produces steel, plastic and fiber drums, intermediate bulk containers, reconditioned containers, jerrycans and other small plastics, containerboard, corrugated sheets and products, uncoated recycled paperboard, coated recycled paperboard, tubes and cores and a diverse mix of specialty products. The Company also manufactures packaging accessories and provides other services for a wide range of industries. In addition, Greif manages timber properties in the southeastern United States. The Company has a workforce of over 14,000 colleagues spread across more than 250 facilities in 37 countries to serve global as well as regional customers. Additional information is on the Company's website at www.greif.com .
Media Contact
TJ Struhs
Director, Corporate Communications
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