Pennexx, which currently has processing facilities in Philadelphia and Pottstown, PA, is purchasing the facility for an undisclosed price as part of an overall expansion strategy, according to company president and CEO Michael Queen.
"We have been searching for a larger facility to accommodate the escalating demand of our case-ready business for some time now, having reached our anticipated capacity at our current facilities in the fourth quarter of 2001," Queen says. "The new facility will substantially increase Pennexx's case-ready production capabilities and begin to fulfill existing business demand."
The sale is expected to close within 30 days and management is scheduled to move in as soon as the deal is completed. Modest upgrades are planned for the property, which was formerly used as a meat processing plant and was approved by the USDA.
"It is perfectly suited to our needs, as it is strategically located in the central Northeast corridor and close to our customers," Queen says of the property. "Since the new facility requires minimal improvement, we will be able to renovate and automate quickly and plan to be operational by the second quarter of 2002. With the automation processes we will have in place we intend to become an industry leader in the emerging market category for case-ready meat in the northeast and realize exponential growth in our business."
Pennexx provides case-ready meat to retail supermarkets in the Northeast within a 300-mile radius of its two Pennsylvania plants. The company cuts, packages, processes and delivers case-ready pork, lamb and veal to roughly 15 customers including ShopRite, Pathmark and Royal Ahold. Smithfield acquired a half interest in the company last June.
Smithfield, with corporate offices here and in Smithfield, VA is the US' largest hog producer and a leading processor and marketer of fresh pork and processed meats. The company reports annual sales of $8 billion.
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