Teamsters Warn French Food Workers of CD&R Takeover of PicardBy International Brotherhood Of Teamsters, PRNE
Saturday, July 3, 2010
Hoffa Sends Warning About 'Fast-Buck Artists' That Hurt Workers, Companies
WASHINGTON, July 4, 2010 - Teamsters General President Jim Hoffa today sent an urgent warning to
workers and their unions at French frozen-food manufacturer Picard Surgeles
about a potential takeover by private equity firm Clayton, Dubilier & Rice
(Logo: photos.prnewswire.com/prnh/20100127/IBTLOGO )
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CD&R, a leading U.S. private equity firm, is currently considering a bid
for Picard Surgeles, a market-leading retailer and manufacturer of frozen
food in France. Several other companies have also expressed interest in
purchasing Picard Surgeles from its current owner, London-based BC Partners.
Three unions currently represent workers of Picard Surgeles in France: CGT,
CFDT and FO.
In a letter addressed to heads of CGT, CFDT and FO, Hoffa discussed the
disturbing aftermath of CD&R-led takeovers of two Teamster-represented
companies, Hertz and U.S. Foodservice. CD&R's participation in a group of
private equity firms that purchased Hertz, a car rental company, in 2006 was
labeled the work of "fast-buck artists" by BusinessWeek after the firms used
Hertz assets to pay themselves a US$1 billion special dividend and eliminated
1,500 jobs. Regarding U.S. Foodservice, Hoffa said that the takeover has led
to "facility closures, layoffs and loss of market share."
"CD&R is now leading U.S. Foodservice down a contentious and destructive
path," Hoffa said in the letter. "Under CD&R leadership, U.S. Foodservice
continues to disregard the rights of its employees, undermining long-term
growth through continued mismanagement, assets sales and cost-cutting.
"I sincerely hope that your unions can avoid a similar leveraged buyout
by any firm interested more in extracting and turning deals than continuing
to build upon the strong legacy of Picard Surgeles. In our experience, a CD&R
takeover can truly hurt workers, their families and entire communities."
U.S. Foodservice is the nation's second-largest foodservice distributor
with 25,000 employees and annual revenues of US$20 billion. CD&R, along with
Kohlberg, Kravis and Roberts (KKR), purchased the company using US$2.1
billion in equity, and US$5 billion of debt taken from U.S. Foodservice's own
assets. In the years following the buyout, USF has closed nine distribution
centers and shed more than 3,000 jobs. Labor relations soured leading to
numerous violations of U.S. labor law, including almost 200 violations of
federal labor law in the State of Arizona.
Hoffa offered to work with CGT, CFDT and FO to avoid any leveraged buy
out for Picard Surgeles.
Founded in 1903, the International Brotherhood of Teamsters represents
more than 1.4 million hardworking men and women in the United States, Canada
and Puerto Rico.
Leigh Strope, +1-202-624-6911, lstrope at teamster.org
Tags: District of Columbia, France, Germany, International Brotherhood of Teamsters, July 4, United Kingdom, Washington