Landmark Group And Maple Leaf Merge To Strengthen Western Canadian Business
WINNIPEG, MANITOBA-Maple Leaf Foods Inc. (TSE: MFI) and The Landmark Group Inc.
today announced the merger of The Landmark Group, including Landmark Feeds Inc.
and Elite Swine Inc., with Maple Leaf. Maple Leaf Foods will acquire all of the
outstanding shares of the Landmark Group and assume all of its debt for a total
investment of approximately $150 million. Shareholders of The Landmark Group
will receive up to 1.5 million shares of Maple Leaf Foods included in the
transaction. The balance of the investment will be financed on existing lines
For Maple Leaf the merger provides a leading Western Canadian animal feed
operation to complement its Shur-Gain business and the potential to access top
quality hogs for its Maple Leaf Pork processing operations in Brandon and
Lethbridge. For The Landmark Group, Maple Leaf provides a world-class
processing partner close to home with strong links to global markets and
enhanced risk management opportunities as well as access to Shur-Gain's
industry-leading animal feed and nutrition research facility.
"This is an extraordinary strategic fit," said Michael H. McCain. "The merger
significantly advances our value chain strategy in both animal nutrition and
enhanced relationships with producers that complements our already significant
investment in Western Canada."
The Landmark/Maple Leaf vertically coordinated system will use a mix of
producer partnerships, including largely independent ownership, and risk
management. The combined research capabilities of Shur-Gain and Landmark will
also benefit Canadian producers. This model contrasts with US-style vertical
integration involving corporate ownership of the entire value chain.
"The Made-In-Canada version of vertical coordination is the better way," said
"This merger brings together two great Canadian companies. Both companies are
deeply committed to ensuring Western Canadian livestock producers have the
support required to allow them to compete in a rapidly changing global market,"
said Bruce Campbell, Chairman and Chief Executive Officer of The Landmark Group
Inc. "Maple Leaf supports and respects Landmarks' management expertise. This
merger is a significant endorsement of our business philosophy."
Landmark Feeds Inc. will continue as a separate operating company providing
quality research-driven feed and animal nutrition programs for pork, beef,
dairy and poultry producers.
"Our companies have worked together for nearly a decade. We have a shared
vision for the future of the feed and livestock industry. We fully expect to
introduce new risk management programs for ESI and other Western Canadian
producers in the near future," said Scott McCain, President and Chief Operating
Officer of Maple Leaf Foods Agribusiness Group.
Elite Swine Inc. will also continue to operate independently. Maple Leaf
recognizes the tremendous management expertise of the Landmark Group and
expects that expertise to stay in place.
"Both companies believe a more coordinated approach to pork production is now
needed to provide producers with better communication and understanding of
consumer needs. We look forward to continuing to work with our producer
partners to increase efficiency, expand production, and produce world-class
pork the Canadian way," said Dickson Gould, President of Elite Swine Inc.
"Shur-Gain has an excellent animal nutrition research program that complements
what we have been doing at Landmark Feeds," added Ron Arnason, President of
Landmark Feeds. "Our combined expertise will truly build value for all of our
Maple Leaf Foods is a leading Canadian food processor. Headquartered in
Toronto, Ontario, the company employs more than 12,000 people at its operations
across Canada, and in the United States, Europe, and Asia.
The Landmark Group Inc. has been involved in various aspects of animal
agriculture in Western Canada for more than 40 years. The group includes
Landmark Feeds Inc., a leading manufacturer and provider of feed for all
species of livestock and Elite Swine Inc. a hog marketing, feed and genetics
provider to pork producers in the region.