Hostess Brands Inc. on Monday confirmed plans to upgrade an unused factory in Arkadelphia, convert it into a bakery and create about 150 jobs over three years.
Company officials also said the plant is large enough for future expansions as the snack maker adds product lines. Hostess said it would spend between $120 million and $140 million to install.
The new bakery will increase the company’s capacity on its donette and cake platforms by around 20%. Officials said the 330,000 square foot facility will begin operations in the second half of 2023.
“We have profitably gained market share in the snack categories in which we compete,” Andy Callahan, president and CEO of Hostess Brands, said in a press release announcing the new plant. “The addition of this new bakery signals our confidence that we expect the growth we have demonstrated over the past few years
Governor Asa Hutchinson welcomed the news. “The Company’s selection of Clark County speaks volumes about the confidence it has in the area’s business climate and workforce, and I am confident that Hostess will find success in Arkansas,” he said in a press release.
The facility, located at 1 Scroll Drive, is the former Danfoss factory which the company closed in January 2020.
The hostess said the decision to renovate an existing building will reduce the company’s costs for the new bakery and minimize environmental impacts.
“We are emphasizing a sustainability-focused approach to this project while leveraging best practices from across our bakery network and anticipate this bakery to be our most efficient and greenest operation yet. day,” Callahan said in the press release.
Arkansas offers two economic development incentives to Hostess. The tax rebate program provides sales and use tax refunds on the purchase of taxable building materials and machinery. And the company will participate for five years in the start-up rebate program, which offers a financial incentive equal to 3.9% to 5% of annual payroll for new permanent full-time employees.
Chief Growth Officer Dan O’Leary said the company considered three key issues before deciding on Arkadelphia: the distribution network, an existing facility that could be converted, and a strong labor pool. . “We were also able to establish a strong partnership with state, county and local authorities,” he said Monday.
Last week, Arkadelphia’s expansion was revealed during a three-hour presentation that company officials gave to the investment community.
Hostess, based in Lenexa, Kan., has five North American bakery plants in Emporia, Kan.; Indianapolis.; Columbus, Ohio; Chicago; and Ontario, Canada.
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