Canadian dairy group Saputo looks set to quit Europe after deciding to close plants in the UK and Germany.

Saputo said today (25 February) it did not have the “critical mass” for its European operations to be profitable.

It announced the closure of its cheese plant in the German town of Heiden that supplies the country’s retailers. Saputo also plans to close a plant in Newcastle Emlyn in Wales that supplies mozzarella to foodservice customers. The closure of the UK site is subject to consultation with staff.

Saputo acquired the facilities in 2006 and 2007 but said it had found its investment in Europe “challenging”.

“Today, the Saputo European  business does not have sufficient critical mass to be profitable and the Company does not see short to mid-term opportunities to ensure such profitability,” the company said.

Europe accounts for a small proportion of Saputo’s business. It does not provide specific financial data for Europe. However, in the year to the end of March 2012, its last full fiscal year, Saputo said its Argentinian and European businesses made revenue of C$507.3m (US$494.5m) – out of turnover of C$6.93bn.

Click here for the full release on the planned closures.