Twinlab Corp., a New York-based nutritional supplement company, announced Wednesday it will consolidate its manufacturing and distribution facilities into its newer facility in American Fork.
The company announced its decision to restructure on the heels of a meeting last week, when Utah's Industrial Assistance Fund committee approved Twinlab for a $452,000 loan. IAF loans are incentives the state uses to attract, keep or grow business in Utah.
Though the money was substantially less than the $2 million Twinlab had requested, state IAF committee chairman David Simmons said the move still made sense because the Utah facility likely is more efficient than the company's New York operations.
Twinlab will lay off about 300 people from its two facilities on Long Island, the company said in a statement. For now, it will maintain its New York headquarters. However, Simmons said Friday that if the company opted for the consolidation, it is also possible Twinlab will move its headquarters to Utah in the next two to three years.
The Utah plant employs about 250 people. Up to 226 more jobs will be added as a result of the restructuring, Simmons said. As a part of the IAF deal, Twinlab agreed to pay wages of at least 125 percent of the county median, and keep those jobs in Utah for at least five years.
"This is great news for us," said Tracie Cayford, spokeswoman for the state's Department of Community and Economic Development. "It's always nice to hear that new jobs are coming to our state. This is a good, clean industry, and these should be great jobs for Utah residents."
The company's restructuring will result in charges of up to $20 million in the third and fourth quarters, the company stated. But the move is expected to save nearly $6 million annually, beginning in 2003.
"This restructuring activity represents the continuation of our commitment to examine all aspects of our operations to improve our financial performance," Twinlab president Ross Blechman said in a statement. "We believe that the consolidation of our manufacturing and distribution facilities will allow us to reduce our overall cost structure, enhance operational efficiencies and customer service and better position the company for future opportunities."
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