Saskatchewan Wheat Pool today announced that it is selling four of Heartland Feeds’ milling assets as well as a Regina based merchandising operation to AGP, Inc., which operates as Masterfeeds in Canada. Masterfeeds is a 73 year-old company that is a leading marketer of animal nutrition products and services. The sale includes Heartland Feeds operations in Regina, Saskatchewan, Taber and Picture Butte, Alberta and Dauphin, Manitoba.
“The Pool will use net proceeds from the sale of approximately $10 million to pay down debt, which is consistent with our objective to reduce debt through divestiture,” says Chief Executive Officer, Mayo Schmidt. “The Pool’s focus is on strengthening what we do best, providing competitive products and services through our grain handling, merchandising and agri-products marketing operations. We are a proven leader in procuring feed grains through our commodity merchandising group and will work to identify future opportunities for our two companies to work together when appropriate.”
Rob Flack, President of Masterfeeds says, “Initially our objective is to work with the Pool to ensure a smooth transition for all employees, dealers, customers and suppliers. The four Heartland operations and the merchandising centre complement our existing western Canadian business by adding a strong presence in the southern Alberta and Saskatchewan markets, as well as the Manitoba feed industry. This acquisition is consistent with our growth strategy to expand into core livestock and poultry markets throughout Canada.”
The remaining businesses under the Heartland Group of Companies are not included in the sale. These include CanGro Aquaculture, Heartland Pork Management and feed mills in North Battleford and Bruno, which primarily produce feed to supply Heartland’s pork facilities. The purchase and sales agreement is subject to usual closing conditions and regulatory approvals. The transaction is expected to close by the end of November. As a result of this transaction, the Pool will record an after tax loss of approximately $8 million or $0.21 per share against its second quarter results.
Saskatchewan Wheat Pool is a publicly traded agri-business cooperative headquartered in Regina, Saskatchewan. Anchored by a prairie-wide grain handling and agri-products marketing network, the Pool channels prairie production to end-use markets in North America and around the world. These core business operations are complemented by food processing and value
added businesses that allow the Pool to leverage its pivotal position between prairie farmers and destination customers. By developing strategic partnerships and supply agreements, the Pool is expanding market opportunities for agri-food products. The Pool’s Class B shares are listed on the Toronto Stock Exchange under the symbol SWP.B.
Headquartered in London, Ontario, with operations coast to coast, Masterfeeds is one of Canada’s largest and fastest growing animal nutrition businesses, and is owned by Ag Processing Inc. (AGP) of Omaha, Nebraska. AGP is the world’s largest cooperative soybean processor and third largest vegetable oil refiner in the United States. AGP is owned by 250 local cooperatives and eight regional cooperatives, representing more than 300,000 farmers throughout the United States and Canada.