• by Thom Forbes  @tforbes, October 2, 2015

ConAgra CEO Sean Connolly says a zero-based budgeting review “took every expense and put it out in the parking lot.” That’s where moving vans will soon be parked, as the company prepares to shifts it headquarters to Chicago with a corporate staff that’s leaner by 1,500 workers, culled from several locations worldwide. 

Overall, ConAgra is looking to save $300 million in annual costs though the layoffs, budget cuts and improved efficiencies. The criteria for any expense getting back into the building, according to Connolly, is “whether we could attach a return to it,” Annie Gasparro reports in the Wall Street Journal. 

The move to Chicago, planned for next summer, will bring 700 jobs to the city. ConAgra will maintain some 1,200 office employees in Omaha, and it “will still be home to more of ConAgra’s workforce than any other city,” Barbara Soderlin reports for the Omaha World-Herald, although it will be the hardest-hit location. 

“We have a responsibility to ConAgra to set it up for the long haul,” Connolly tells Soderlin of the “agonizing” decision to move HQ, “even if that means we have to do difficult things in the short haul.”

Look for more to come. Connolly, the former Hillshire Brands CEO who joined ConAgra in April, tells Reuters’ Anjali Athavaley: "While we believe that we can create a lot of value with ConAgra Foods, that's only going to happen if we make bold change, and we're going to continue to push for change.” 

The marketer of Slim Jims, Peter Pan peanut butter, Orville Redenbacher popcorn and Chef Boyardee was founded in 1919 through the merger of four flour mills and was first known as Nebraska Consolidated Mills, Paul R. La Monica reports for CNNMoney. It became ConAgra in 1971.

A ConAgra office in Naperville, Ill., 27 miles to the east of the Windy City, will be one of the locations affected. Its staff includes marketing, finance, business development and sales teams for the consumer division, and supports such brands as Hunt's, Chef Boyardee, Egg Beaters, Hebrew National and Peter Pan, reports the Naperville Sun’s Jane Donahue.

Connolly, who lives in the affluent Chicago suburb of Winnetka, “said it made sense to consolidate operations in Chicago because most of the company's consumer food division was already based in the area. Previously, frozen foods were based in Omaha while other consumer products were in Naperville,” Donahue writes. 

Connolly led Hillshire’s move from its suburban Downers Grove, Ill., headquarters to downtown Chicago in 2012 — a move he characterized as a “rebirth” at the time. 

“We need that energized culture [in Chicago] for our consumer-brands segment,” Connolly tells the WSJ’s Gasparro. “I know that drill.”

Tyson Foods acquired Hillshire Brands in April 2014.

Crain’s Chicago Business’ Greg Hinz writes that Connolly “danced a bit when I asked about widespread speculation that, after the company shrinks and reorganizes, it will be put on the block.”

“Our job is to create value for shareholders,” Connolly replied. “If another plan were to emerge that was viable and real, of course we would consider it.” But he said such talk is “speculative.”

ConAgra “follows in the footsteps of Kraft Heinz which, facing similar pressure to deliver greater profits, announced in August the layoffs of 2,500 workers, including 700 locally, and plans to relocate its Chicago-area offices to downtown Chicago,” point out Greg Trotter and Kim Janssen for the Chicago Tribune. 

While Chicago Mayor Rahm Emanuel “touted Chicago’s educated workforce, its transportation links, its business community and overall vibrancy as the keys to wooing an increasing number of corporate headquarters to the city,” Illinois Gov. Bruce Rauner also offered tax credits to ConAgra in return for a promise to bring at least 150 jobs to Illinois for at least 15 years, Trotter and Janssen report. 

The “news comes as ConAgra moves forward with plans to sell its money-losing private label business, which has underperformed despite the company’s heavy investment, led by the $5 billion purchase of Ralcorp three years ago,” Fortune’s Tom Huddleston reminds us. Connolly admitted that buying Ralcorp — a deal closed by former CEO Gary Rodkin as part of the company’s “Recipe for Growth” strategy in January 2013 — was a mistake when he announced the plan to divest it in late June.

The recipe du jour at ConAgra appears to be decidedly lean and lo-cal.