In a strategic move, Alico, Inc., a Florida-based agribusiness company, has initiated significant changes to its operations, as disclosed in a recent SEC filing.
On January 3, 2025, Alico delivered a notice to Tropicana Manufacturing Company, Inc., seeking consent to remove certain acreages from their existing orange purchase agreement due to the acreage's lack of economic viability for orange cultivation. This adjustment, subject to Tropicana's consent, would take effect after the 2024/2025 crop year, potentially concluding Tropicana's purchase obligations for the specified acreage.
Simultaneously, Alico's Board of Directors has approved a workforce reduction as part of cost-saving initiatives. This reduction aims to enhance investor returns and pivot from conventional agriculture to diversified land use and real estate development strategies.
The decision to downsize is influenced by the financial burdens imposed by citrus greening disease and environmental challenges that have plagued the citrus division for multiple seasons.
The workforce reduction will affect up to 172 employees, with up to 135 layoffs taking place today and an additional 37 slated for around April 1, 2025. The company estimates the associated costs, primarily severance and related benefits, to be between $1.5 and $2.0 million, with the majority of expenses expected in the second and third quarters of 2025. However, these figures are subject to change based on future events related to the workforce reduction.
This restructuring reflects Alico's shift towards a long-term strategy of diversified land usage, as the company navigates the challenges within the citrus industry. The information in this article is based on a press release statement and may contain forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those expressed or forecasted in these statements.
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