P&G to build $150 million olestra plant


Procter & Gamble Co. said it will build a $150 million plant in Cincinnati to make its new no-fat, no-calorie fat substitute, olestra.

The factory, to be constructed at P&G's Ivorydale manufacturing complex, is scheduled for completion by early 1999, the company said. In the meantime, P&G said it will make olestra, under the brand name Olean, at a test-market production plant at Ivorydale.

Procter & Gamble, the largest U.S. consumer products company, won approval Jan. 24 from the U.S. Food and Drug Administration to begin using olestra, a sugar and vegetable oil combination with molecules too large for the body to absorb, in salty snacks. It also is making the product available to other snack-food makers.

P&G said it won a 10-year, 100 percent tax abatement on the new plant from the Cincinnati City Council. P&G will pay an average of $1.2 million a year to Cincinnati's school system, the amount of tax revenue it would have received from the plant.

Ivorydale is P&G's oldest manufacturing facility, in operation since 1886.

Although there have been modernization projects there, the olestra factory will be the first new plant on the site in 50 years, the company said.

P&G will first use olestra, which looks, tastes and heats up like corn oil and other fats, to make new versions of Pringles potato crisps, which will be test-marketed in the next few months.

Pub Date: 3/22/96

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