Post Holdings Inc., the St. Louis-based cereal maker that bought the Minnesota-based maker of Malt-O-Meal earlier this year, said Friday that it will consolidate its cereal operations in the Twin Cities suburb of Lakeville.
Post will close its office in Parsippany, N.J., where about 200 people work, as a result of the move. Its corporate headquarters will remain in St. Louis.
The combination of Post and MOM Brands, as the Malt-O-Meal company has been known since 2012, merges the nation’s third- and fourth-largest makers of cereal. The business will be called Post Consumer Brands and will be led by Chris Neugent, president of MOM Brands.
“Combining our businesses in Lakeville will create a powerful branded platform for both branded cereal and further acquisitions,” Rob Vitale, Post Holdings’ president and chief executive, said in a statement. “While I am delighted that Chris and his colleagues are joining Post, we are acutely aware of the contributions made by employees negatively impacted by this decision, and we are committed to helping them through this transition.”
Post said it will spend $27 million to $30 million on severance, retention and relocation payments to workers in the New Jersey office. The company said that it expects to see $50 million in annual savings by combining the operations and moving them to Minnesota.
The two companies announced in February that Post would spend $1.15 billion for MOM Brands. The deal initially created a spasm of uncertainty about the fate of the MOM Brands corporate office in Lakeville, where 250 work, and its cold-cereal plant in Northfield (about 40 miles south of the Twin Cities), which employs 650.
Post and MOM combined have about $3 billion in annual sales and an 18 percent share of the U.S. cereal market. General Mills Inc. and Kellogg Co. each have about a 30 percent market share.