Nestlé selling off ice cream business, including London facility

Nestle’s ice cream business, including its London facility is being sold. CTV’s Bryan Bicknell explains why.

Change is coming for one of London’s largest food producers. Nestlé has announced it’s selling its ice cream business, including its plant on Wilton Grove Road.

“For Nestlé, we’re not exiting the ice cream category, we’re just utilizing a different model,” said Catherine O’Brien, senior vice-president, corporate affairs, Nestlé Canada.

Nestlé announced Thursday it has entered advanced negotiations to sell the remainder of its ice cream business to Froneri, the ice cream focused joint venture it created in 2016 with buyout firm PAI Partners.

The sale includes the Canadian market with the London plant.

“It’s a factory that is producing amazing products. It’s a factory of very dedicated, talented people. They will continue to do what they have been doing, understanding, having a little uncertainty at the moment. Hopefully that will be clarified quickly in the future,” O’Brien said.

According to Teamsters Canada there are between 600 and at peak season 800 unionized employees at the London plant. Currently they have two years left in a collective agreement, and union leadership says right now their goal is to protect those jobs.

Gary Bast, Teamsters Local 647 secretary treasurer and business representative says not knowing what’s in store is the hardest part.

“Are they going to reduce manpower? Are they going to increase manpower? It’s all unknown. That plant is a good mid-class job. Those guys make good wages. Most of them are from the community of London. We’re in the same boat as everybody else. We just don’t know what’s going to happen,” said Bast.

Bast says they’re also reaching out to union counterparts in Europe, where Froneri has already taken over some ice cream operations, to learn what their experience has been with the new owner.

In November 2021, Premier Doug Ford was on hand at the Wilton Grove plant as the company announced a $41 million expansion.

“That’s not pennies in a bucket, it’s a huge investment,” added Bast.

In the meantime, food industry expert Sylvain Charlebois says a change in ownership is not necessarily bad news. The Dalhousie University professor and researcher says the London facility being within a food processing cluster bodes well for its future.

“Typically, food companies tend to stick around and help each other out. That’s really how the agri-business world works. You can’t think of a plant as a stand-alone entity, it needs a network of ingredients and knowledge to support it. And London actually has that,” explained Charlebois.

In a statement, Nestlé says the transition to the new owner will take 12 to 18 months.

“During this period, operations will continue as usual and there will be no immediate changes for our employees, customers, or partners. We are committed to transparent communication and a responsible transition and will share updates as they become available,” the company said.