US food group Post Holdings is to base its cereal business at the head office of MOM Brands, the rival it acquired in January, a move that will affect around 200 staff.
The combined operations will have its headquarters in Lakeville, Minnesota. Post will close its office in Parsippany in New Jersey.
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The business, called Post Consumer Brands, will be led by MOM Brands president Chris Neugent. He will report to Rich Koulouris, who joined Post Holdings in February to lead its Post Foods Group division, comprising Post Consumer Brands and its private-label retail businesses.
"Combining our businesses in Lakeville will create a powerful branded platform for both branded cereal and further acquisitions," Rob Vitale, the president and CEO of Post Holdings, said.
Post expects the move to lead to pre-tax expenses of $27-30m for employee severance, retention and relocation payments. Approximately half of the charges are expected to be incurred in the third quarter of Post's 2015 financial year with cash payments in the company's 2016 and 2017 fiscal periods.
The costs are part of one-time charges Post had already announced to achieve cost synergies of between $70-80m and will not impact the company's guidance for fiscal 2015, it said.
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By GlobalDataThe move is expected to result in savings that are part of the approximately $50m of cost synergies that Post previously announced in connection with the acquisition of MOM Brands.
Click here for our analysis, published in January, of Post's move for MOM.
