Company Struggles to Cut Costs and Pay Down $1.1 Billion of Debt

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NEW YORK ( -- Aurora Foods, St. Louis, said it plans to cut roughly a quarter of its corporate staff as part of its ongoing strategy to streamline operations and improve profitability.

The announcement follows recent management reorganizations, including the promotion last week Eric Brenk and Michael J. Hojnacki as co-presidents and co-chief operating officers and the formation of three distinct sales divisions.

"Our objective is to be a leaner, stronger and more profitable company," Dale Morrison, Aurora's chairman-CEO, said in a statement. The staff cuts are expected to drive annual savings of more than $10 million.

Faces delisting
Aurora has been struggling to cut costs and pay down about $1.1 billion of debt. In December, Aurora said it was notified by the New York Stock Exchange that it had six months to raise its share price to above $1 for a 30-day period or face delisting. Aurora shares closed Friday at 35 cents, down a penny.

The company said last week its plans to better leverage its $1 billion portfolio of brands at retail and return to higher media-spending levels as the faltering economy "gets back to basics."

Already, the company has laid off 204 employees by closing a bagel plant, and Mr. Morrison said the company is in final talks to sell its frozen-food brands, including Mrs. Paul's and Van de Kamp's seafood, Celeste pizza, and Aunt Jemima's breakfast products, which would raise roughly $325 million.

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