An executive with Upstate Niagara Cooperative Inc. announced that it has signed a purchase agreement to buy the Alpina Foods plant in Batavia.
Larry Webster, chief executive officer of Upstate Niagara, broke the news at tonight's Genesee County Chamber of Commerce awards ceremony at Quality Inn & Suites in Batavia.
The Alpina plant is located in the Genesee Valley Agri-business park at 5140 Ag Park Drive West. The plant operated by the yogurt maker closed in January.
UPDATE 10:20 p.m. (by Howard): After tonight's Chamber awards, Webster said Upstate's immediate plans for the former Alpina plant aren't settled but that acquiring an ultramodern dairy-processing facility in a strong milk shed where Upstate has been looking to expand was too good of an opportunity to pass up.
"The way I termed it, it's the farm next door," Webster said. "When it came up for sale we were looking to expand and so it just kind all worked out well."
The plant represents a $60 million investment by Alpina, a Colombia-based company that attempted to crack the U.S. greek-yogurt market by opening the plant in the Genesee Valley Ag-Business Park five years ago. Webster said Upstate will pay somewhere in the neighborhood of the $20 million to $25 million asking price on the plant but said he wasn't ready to disclose the purchase price.
"We just knew that it was an opportunity to pick up a production-ready plant in our area and so we did," Webster said. "We're not 100-percent sure exactly what we're going to do there yet."
The plant will be filled, Webster said and he expects that the plant is ready to employ 40 to 60 people, and more if the plant expands. Part of what attracted Upstate to the property is that while the plant sits on a 10-acre parcel, there is a 10-acre parcel next to it that is vacant but is included with the purchase.
"That makes room for expansion, which we were interested in," Webster said. "It's in the right place at the right time and ready to go. We've got some customers that we think could fit in there quite well and we could utilize it fairly quickly."
Frequently, Upstate operates on a co-packing basis with clients who need a production facility for their dairy-product brands. Webster indicated he expects that's how the former Alpina plant will be used.
The purchase offer was signed Thursday and is contingent on a due-diligence process but Webster didn't expect any issues to arise before the acquisition is final.
The project will likely also be eligible for an incentive package from the Genesee County Economic Development Center, which also provided more than $700,000 to Alpina to build and expand the plant, according to a source who was at Saturday's dinner. The scope and nature of the incentive package has not yet been settled on.
When Massachusetts-based HP Hood bought the former Muller Quaker plant, which is also in the ag park, it also negotiated an updated tax-abatement package with GCEDC.
Webster said he doesn't expect Upstate will follow the example of Dairy Farmers of America, which purchased the former Muller Quaker plant across the street and flipped it to HP Hood a year later without ever producing any product at the plant.
"That's not in our plans at all," Webster said. "We bought it for our use and our history is just that. We've been operating plants for quite awhile and didn't buy it because we thought it was cheap and we could turn around and resell it or anything like that. We felt we paid a fair price for it but it's for our use."