Its poultry-processing industry at one time on the ropes, Harris County on Thursday got a major economic boost with the expansion of a Pine Mountain Valley plant that looks to add more than 750 employees on top of the 700 people already working there.
Park Ridge, Ill.-based Koch Foods, with an assist from Georgia Gov. Nathan Deals office, said its investment to add new processing lines will amount to $49 million.
Kochs subsidiary, JCG Foods LLC, bought the factory out of bankruptcy last year from Cagles Inc. The deal for the Cagles property and assets was reportedly in the range of $93 million.
Tommy Knight, vice president of Koch Foods western division, noted in a statement Thursday the cooperation his company received in lining up the expansion.
The attitude displayed by the people who helped us along the way affirms our commitment to invest in this community and continue the relationships that we have developed, he said.
Koch retained the 350 employees remaining on the Cagles payroll at the time of the bankruptcy acquisition, then ramped up processing, adding 350 more workers.
The expansion will push the total workforce at the plant over 1,400. The Valley Partnership, which helped broker the latest move by Koch, said the total workforce should equate to annual payroll of $85 million for the Harris County facility.
It should also generate $500,000 in sales tax revenue for the county each year, according to data crunched by Columbus State University.
These are jobs for people that need jobs. This is a great project, especially in a rural part of the state, said Becca Hardin, executive vice president of economic development with the Greater Columbus Chamber of Commerce. She serves a dual role with the chambers regional development entity, The Valley Partnership.
To be able to supply this expansion, area farmers are going to have opportunties to create state-of-the-art chicken houses to raise the chickens for these new lines, she said of the additional businesses that Koch Foods expansion will spawn in area counties.
Before its Chapter 11 bankruptcy protection filing in October 2011, Atlanta-based Cagles had been slashing its workforce sharply as production slowed. Soaring feed costs were hurting the company, with sales of chicken breasts sliding at the same time.
That prompted the company, founded in 1945, to reduce production shifts, followed by layoffs that eventually cut the one-time major employer to the bone as its financial losses mounted. Its assets also included a processing plant in Collinsville, Ala., a hatchery in Dalton, Ga., and a feed mill in Rockmart, Ga.
After receiving bankruptcy court approval to buy Cagles, Koch Foods Chief Executive Officer Joe Grendsy was quoted by Bloomberg Businessweek as saying the acquisition was a very, very natural fit for his company. He also said there were plans to quickly ramp up poultry processing with the new assets.
Harris County Commission chairman Harry Lange noted the work of several entities to get the expansion done. Aside from The Valley Partnership, it includes the Georgia Department of Economic Development, the Georgia Public Service Commission and Liberty Utilities (formerly natural gas supplier Atmos Energy).
Said Gov. Deal of the expansion: Georgia is the top producer of poultry in the United States and Koch Foods is one of the reasons why.
ABOUT KOCH FOODS Founded in 1973, Koch Foods began as a one-room chicken deboning and cutting operation. Following its first acquisition in 1995 and subsequent acquisitions of feed mills and slaughterhouses, Koch Foods has grown into a poultry processor that distributes fresh and frozen products internationally under the Koch Foods, Antioch Farms, Preferred Foods and Rogers Royal brand names, and other custom and private labels. In 2010, Koch Foods made Forbes Magazines Americas Largest Private Companies list at No. 220.
* Source: Koch Foods