In a consolidation move, Toronto-headquartered global packaged media supply chain provider Cinram is relocating its replication activities to the US, thus ending 40 years of disc manufacturing presence in its country of birth.

DVD and Beyond was alerted by one of the 55 employees who received their pink slips. They were told costs were too high in Canada and, by July, all CD and DVD production would be moving to Cinram's plants in Olyphant, Pennsylvania, and Huntsville, Alabama. No Blu-ray discs are produced in Canada.

Cinram confirmed, however, that all global leadership, finance, treasury and marketing remain in Toronto, as does distribution.

Laid-off employees were said to be "dumbfounded" because they thought "a lot of money was made in the Canadian plant at least during the busy season to Christmas." They reckon the loss of Alliance Films' contract to Sony DADC when the independent producer was acquired by home entertainment distributor eOne last year contributed to the consolidation move.

The Olyphant plant had already reduced its workforce before it was acquired by Cinram Property Group, an affiliate of Cinram's new owner private equity firm Najafi Companies. "Olyphant laid off workers in line with declines in industry, just as every replication site and company has around the world," CEO Steve Brown told DVD and Beyond, pointing out the company still count over 6,000 employees globally.

"The replication industry has been experiencing volume challenges over the last few years and the Canadian physical media market has been no exception to this decline," Brown said. "Our decision was most difficult given the company's origins and history in Canada, but the relocation of our Canadian replication operations allows us to sustain a commercially viable distribution and fulfillment footprint in Canada. It gives us the ability to continue supporting our clients in the most efficient and effective way possible."

Story filed 18.06.14