TORONTO, Jul 20, 2007 (Canada NewsWire via COMTEX News Network) — TSX: MFI
Maple Leaf Foods (TSX: MFI) today announced that it has closed the sale of its animal nutrition business to Nutreco Holding NV (“Nutreco”) for CAD$500 million plus closing adjustments.
“We are very pleased to complete this sale to Nutreco,” said Michael McCain, President and CEO of Maple Leaf Foods. “This is another major step on our transformational journey as we build a highly profitable, value-added bakery, meat and meals company. The transaction will result in a significant de-leveraging of our balance sheet and provide Maple Leaf with even more flexibility to re-invest in our value-added businesses.”
Maple Leaf Foods is reorganizing its protein value chain operations, which include its animal nutrition, hog production, and fresh and further processed meats operations, to focus on growth in its branded, value-added protein and bakery businesses. The Company is on track to complete this process by the end of 2009, with the objective to significantly increase earnings and reduce its exposure to underlying currency and commodity influences.
Proceeds from the transaction will initially be used to pay down short-term debt. Proceeds from the transaction will provide the Company with significant resources to invest in global expansion of its value-added protein and bakery businesses. The Company’s initial estimate of its pre-tax gain on the transaction is approximately $300 million. The final gain on the sale will be disclosed after all final adjustments have been accounted for.
Maple Leaf Foods Inc. is a leading food processing company, headquartered in Toronto, Canada. The Company employs approximately 22,500 people at its operations across Canada and in the United States, the United Kingdom and Asia, and had sales of $5.9 billion in 2006.
SOURCE: Maple Leaf Foods Inc.
Michael Vels, Chief Financial Officer, MAPLE LEAF FOODS INC., (416) 926-2048