MARS HILL, Maine — The former owner of the Pineland Farms potato factory in Mars Hill is in the process of transitioning the company’s cheese packaging operation to Bangor.
The Pineland Farms potato factory is seen from Route 1 in Mars Hill on Aug. 29. Bob Evans Foods, which acquired the factory from the Libra Foundation, will be expanding some of its potato production space when Libra’s Pineland cheese packaging operation transitions to Bangor. (Staff photo/Anthony Brino)
When Ohio-based Bob Evans Foods acquired the factory from the Libra Foundation for $115 million earlier this year, the two organizations agreed to gradually phase out the Mars Hill factory’s cheese packing operation within a year.
The transition is moving along as part of a larger dairy venture Pineland Farms is undertaking in Bangor, according to Jere Michelson, president, COO and CFO of the Libra Foundation.
Libra, the Portland-based nonprofit foundation that owns the Pineland Farms companies, has an agreement in place with Bob Evans to move the cheese operation from the Mars Hill plant by May 2018.
Michelson said the cheese packaging operation likely will be moved by January to Bangor, where Libra is “resurrecting” the old Grants Dairy factory. The foundation purchased the former plant for $620,000 and is investing $6 million in the facility, he said.
There, Libra is centralizing its dairy business, moving the cheese making operation currently based in New Gloucester and the packaging operation now in Mars Hill, along with a new milk-blend operation producing milk products for food makers like Bob Evans.
“Essentially, we now have it in two spots — production in New Gloucester and storage and conversion in Mars Hill,” Michelson said. “We plan on consolidating both of those activities in the Bangor plant.”
The cheese space in Mars Hill will likely become part of the potato operation at Bob Evans, which makes mashed and other cooked potato products, Michelson said. “They need that space in there.”
Currently 15 people work in cheese packaging at the Mars Hill factory, and about another 10 in the New Gloucester cheesery. Michelson said Libra has offered the 15 Mars Hill cheese employees positions in Bangor and that two of them may be taking them up. The rest are set to be offered other positions by Bob Evans in the potato plant, which currently employs about 200 people.
He added that the New Gloucester cheese production will likely be moved to Bangor by next summer and that the milk blend production is expected to begin by next fall. The company will be buying milk from Maine dairy farmers and employing about 50 people at the Bangor plant, he said.
The Pineland Farms cheese business started in 2006 and was all based out of New Gloucester until 2013, when the company started shipping finished bulk cheese to Mars Hill for cutting and packaging.
The Pineland Farms potato business was founded by local businessman Rodney McCrum in 1997 as Naturally Potatoes. The Libra Foundation was a major investor in the potato factory starting in 1999 and acquired the company as a majority owner in 2010 from a California company that purchased it in 2005.
The 125,000-square-foot potato facility employs almost 200 people and purchases some 100 million pounds of potatoes from more than two dozen Aroostook County farms.
The sale to Bob Evans made sense for the Libra Foundation because a larger company was needed for the scale of the business as it took on more sales to retailers such as Walmart, Michelson said.
Pineland Farms’ dairy business moving to Bangor also brings the potential to supply dairy products to Bob Evans, which spends about $6 million annually on milk blends for its mashed potatoes, Michelson said.
When Dean Foods was operating the former Grant Dairy factory, until it closed in 2013, it was supplying milk blends to the Mars Hill potato factory, Michelson said. Libra and Bob Evans are now in “preliminary talks” on setting up a sales deal, he said.
“We hope to be able to supply Bob Evans, provided we can do a decent job and be competitive and take in some of that business.”
