Canada Bread Company, Limited, 68% owned by Maple Leaf Foods Inc. (TSE:MFI), and Multi-Marques Inc. announced today they have reached an agreement for Canada Bread to increase its 25% ownership in Multi-Marques to 100% by purchasing the remaining outstanding shares currently held by six Quebec families.
Details of the transaction are not being disclosed. Closure of the transaction, which is expected to be in April 2001, is subject to regulatory approval.
Multi-Marques is a leading Quebec bakery business with annual sales of over $300 million. The company owns and operates 12 baking facilities throughout Quebec, plus City Bakery in North Bay, Ontario. Multi-Marques also owns 60% of Ben’s Bakery in the Maritimes. Ben’s has locations in Halifax, Nova Scotia and Moncton and Grand Falls, New Brunswick.
Canada Bread and Multi-Marques have a long-standing business partnership dating back to 1971. The operations of the two companies are highly complementary with Multi-Marques being Quebec’s leading bakery company.
“We have been considering our options for future growth and development for some time and decided expanding our relationship with Canada Bread offered the best opportunity for the future,” said Michelle Samson-Doel, Chairman of Multi-Marques. “It is really a logical evolution to our business with a trusted, long-time partner.”
“Multi-Marques has an excellent management team and is one of the great operators and innovators of the Canadian baking industry. In 2000, the company was named one of the 50 best-managed, private companies in Canada, according to Arthur Andersen, CIBC and the National Post. Canada Bread and Multi-Marques are a great operational and strategic fit and we’re very pleased they chose us in considering their options,” said Richard Lan, Chairman of Canada Bread Company, Limited and President, Maple Leaf Bakery Group. “Together Multi-Marques and Canada Bread will be stronger than either on its own.”
“This transaction creates a stronger, more competitive bakery business that can serve all of our customers on a truly national level,” said Roger Dickhout, Chief Executive Officer of Canada Bread. “Bringing the two together really creates the best opportunity for future growth for all the stakeholders of both companies.”
“Expanding our business relationship with Canada Bread helps us achieve our vision of becoming a leading company nationally. The plan is to maintain operations on a business as usual basis. Employees, customers and suppliers for the most part will experience little change,” said Michel Proulx, Chief Executive Officer of Multi-Marques. “A strong, local management team will be staying and continuing to work with Canada Bread as we have done for a long time to grow the business.”
Under the terms of the acquisition, Multi-Marques will retain its name and become a wholly-owned, independent operating company of Canada Bread. While the ownership structure changes, operationally, Multi-Marques will continue to function independently with its own management team. The acquisition is expected to be modestly accretive to Canada Bread’s 2001 earnings, neutral to Maple Leaf’s 2001 earnings, and accretive to earnings thereafter.
Multi-Marques Inc. is a manufacturer and distributor of bakery products in Quebec under the trademarks: Gailuron, Diana Durivage, Bon Matin, Petite Douceur, POM, Cuisine Nature and Maison Cousin. It markets under the Aunt May’s brand in Ontario and the Holsum, Ben’s and Levesque brands in Nova Scotia, New Brunswick and Prince Edward Island through its subsidiaries.
Canada Bread Company, Limited is a leading Canadian manufacturer of value-added flour-based products. Canada Bread maintains a national presence in the marketplace with three principal brand names: Dempster’s(TM), Olivieri(TM), and Tenderflake(TM). Canada Bread Company, Limited is 68% owned by Maple Leaf Foods Inc.
Maple Leaf Foods Inc. is a leading global food processing company. Headquartered in Toronto, Canada, the company employs more than 13,000 people at its operations across Canada and in the United States, Europe and Asia. Maple Leaf Foods reported sales of $3.5 billion in 1999.
NOTE: Media are invited to a briefing today at 1:00 p.m. EST at Le Centre Sheraton, Salon 7, 1201 Boulevard Rene-Levesque Ouest in Montreal. Media unable to attend in person are invited to call in and ask questions. The dial-in number is 888-942-8171.