Perrigo Announces Strategic Investment to Expand and Strengthen U.S. Infant Formula Manufacturing
Acquisition of Nestlé Gateway infant formula plant Eau Claire, Wisconsinalong with U.S. and Canadian rights to Good Start® infant formula brands
Investing in Gateway factory now to add £7m capacity needed for infant formula industry and expand consumer choice
Investment marks first phase of Perrigo’s supply chain transformation program
Dublin, November 1, 2022 /PRNewswire/ — Perrigo Company plc (NYSE: PRGO) (“Perrigo” or “we”) today announced that $170 million Strategic investment to expand and strengthen US infant formula manufacturing. This is expected to strengthen industry capacity, expand consumer choice and increase parent and caregiver access to safe and affordable infant formula. As part of this strategic investment, Perrigo purchased Nestlé’s Gateway infant formula plant. Eau Claire, Wisconsinalong with U.S. and Canadian rights to Good Start® A brand of infant formula. again, $170 millionPerrigo will invest soon $60 million Expand Gateway’s 29 million lb. year capacity within 18 months to 7 million pounds or more than 100 million 8 oz bottles per year, adding a total of 36 million lb. capacity to Perrigo.These investments are approximately $20 million Each year Perrigo invests to ensure a safe, high quality supply of infant formula. Vermont When Ohio Infant formula facility.
Prior to the purchase of the Gateway plant, Perrigo did not have sufficient capacity to meet consumer demand for branded customers with 17 stores selling infant formula at approximately 50% discounts to major national brands. We were also unable to fully meet the demands of our contract manufacturing customers, including new market entrants and rapidly growing premium national brands.This newly added capacity will allow Perrigo to not only increase supply to these customers, but also support a good start.® American brand and Canada By improving the availability and expanding capacity of the Gateway plant. In addition to expanding Gateway plant capacity to produce a wider range of formulas, these new investments will help Perrigo increase consumer choice of infant formula in the marketplace.
“Long before this year’s infant formula shortage, we were looking for options to increase our production capacity to meet the growing demand for infant formula in the United States,” said Perrigo President and CEO. the CEO said. Murray Kessler“However, this year’s industry shortages have spurred our commitment to invest not only in meeting the demand of our store brands and contract customers, but also in preventing future infant formula shortages. The purchase and expansion of Gateway is our first major initiative recently announced under our Supply Chain Reinvention Program. Low cost, high quality infant formula will now be available to consumers, creating value for Perrigo’s shareholders.”
Kessler added: Wisconsin plants and a good start® We look forward to integrating the brand team into the Perrigo family and working with the world-class Nestlé organization on a seamless transition. ”
“In making this decision, we prioritized ensuring parents and caregivers a continuous supply of safe, high-quality infant formula and providing our employees with a great home. Perrigo is clearly right. It was a choice,” he said. Tarun Markani, CEO of Gerber, a subsidiary of Nestlé. “This sale will allow Gerber to pursue new growth opportunities and focus on what it is known for in the U.S., which is its core baby food business, which includes purees, snacks and cereals.”
Perrigo operates Good Start® U.S. infant formula brand and CanadaNestlé will continue to fulfill existing Female Infants and Infants (WIC) contracts to ensure uninterrupted supply with Perrigo supplying products through the Gateway factory.
Perrigo expects to purchase the Gateway infant formula plant along with US and Canadian rights to Good Start.® A brand of infant formula that instantly increases net sales, gross margin and earnings per share. The transaction was funded without additional debt and does not affect his Perrigo’s plans to reduce debt over the next three years.
Perrigo Company plc (NYSE: PRGO) is a leading provider of consumer self-care products and over-the-counter (OTC) health and wellness solutions that empower consumers to proactively prevent or treat self-managed conditions. , enhances personal well-being. – managed. Visit Perrigo online at www.perrigo.com.
Certain statements in this press release, including statements regarding the expected costs and benefits of investing in infant formula capacity, are “forward-looking statements.” These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and the actual results, levels of activity, performance or performance of our company or its industry. It involves other factors that may cause it to differ significantly from that shown. or implied by forward-looking statements. In some cases, forward-looking statements are “may,” “could,” “could,” “could,” “may,” “expect.” can be identified by terms such as , “anticipate”, “plan”, and “anticipate”. “intend”, “believe”, “estimate”, “predict”, “may” or negation of these terms or other equivalent terms. We base these forward-looking statements on our current expectations, assumptions, estimates and projections. Although we believe that these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements involve known and unknown risks and uncertainties that Many are beyond our control. and its variants and the impact of their associated supply chains on our business. general economic, credit and market conditions;effects of war on Ukraine its escalation, including the impact of economic and political sanctions imposed by usa, England, the European Union and other countries associated with it. The occurrence or spread of disputes in other areas where we do business. future impairment charges; customer acceptance of new products; competition with other industry participants; Some participants have more marketing resources or a larger market share than us in certain product categories. Price pressure from customers and consumers. the potential impact of ongoing or future government investigations and regulatory initiatives; uncertainties regarding the timing of certain regulatory approvals and our ability to obtain and maintain them, the potential costs and reputational impact of product recalls or suspensions; the impact of tax reform legislation and/or changes in healthcare policy; fluctuations in exchange rates and interest rates; our ability to implement and achieve the desired benefits of announced cost reduction efforts and other strategic initiatives and investments, including our ability to achieve expected benefits from our supply chain transformation programs;These and other significant factors, including those described in the “Risk Factors” section of the Company’s Form 10-K for the last year December 31, 2021Form 10-Q for the closed quarter July 2, 2022, and our subsequent filings with the U.S. Securities and Exchange Commission, our actual results, performance or achievements may differ materially from those expressed or implied by these forward-looking statements. The forward-looking statements in this press release are made only as of the date of this press release and, unless otherwise required by applicable securities laws, the Company does not make any statements, whether new results or not. , disclaims any intention or obligation to update or revise any forward-looking statements. information, future events, or otherwise.
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