Saputo Inc. announced yesterday that it has entered into an agreement to acquire the fluid-milk and cheese operations, as well as certain joint-venture interests of Agrifoods International Cooperative Limited, more commonly known as ``Dairyworld Foods.'' This agreement, which has been approved by the Agrifoods board of directors, is subject to ratification by the cooperative's delegate body at a meeting to be held in mid-January 2001.

The purchase price of the Dairyworld Foods transaction is C$407 million (US$268 million) on a debt-free basis and will be financed through bank indebtedness. The transaction, subject to the usual conditions (including approval by the Competition Bureau), is expected to be closed by the end of January 2001.

Dairyworld Foods has annual sales of C$1.4 billion (US$921 million) and EBITDA of C$61.4 million (US$40.4 million). The company employs 3,200 people and operates 24 plants in Canada. Dairyworld Foods produces and markets fluid milk, yogurt, cheese, butter, skim-milk powder, juices and value-added food ingredients. The company's leading brands are Dairyland, Dairy Producers, Baxter, Armstrong and Fraser Valley. After the transaction, Saputo will have annualized revenues of C$3.4 billion (US$2.2 billion) and EBITDA of C$329 million (US$216 million), with more than 8,450 employees and 55 plants in operation across North America.

According to Camillo Lisio, Saputo president and chief operating officer, ``The Dairyworld transaction is a key strategic step towards our objective of becoming a leading player in the North American dairy industry. It also diversifies the product range in Saputo's core business. Dairyworld's seasoned team will strengthen our group and will contribute significantly to our growth.'' Lino Saputo, chairman and CEO of Saputo concurred. ``We believe this transaction places us at the forefront of the Canadian dairy industry and we intend to work with all industry participants, so that together we can successfully face the challenges that lie ahead,'' he said.

For more information about this transaction, please visit www.saputo.com.

About Saputo

Saputo Inc. is a North American manufacturer of dairy and grocery products. From its dairy processing operations, Saputo manufactures mainly mozzarella, with expertise extending to other Italian, European and North American cheeses, as well as value-added whey byproducts such as lactose and whey protein. The company's leading dairy brands include Saputo, Stella, Frigo, Dragone, Caron and Cayer. In Canada, Saputo also operates a distribution network where it markets a wide variety of imported cheeses and nondairy products to complement its cheese offerings. Through its grocery products division, Saputo manufactures and distributes snack cakes, cookies, fine breads and soups, under such well-known brand names as Vachon, Viau- McCormicks, Grissol and Loney's.

Saputo currently has 5,250 employees in its workforce. The company operates 15 dairy products plants in the United States, as well as 11 plants and a network of 17 distribution centres in Canada. In the grocery products sector, Saputo operates five plants in Canada along with a direct-to-store delivery network of 53 warehouses and five distribution centres. Saputo shares are listed on the Toronto Stock Exchange under the symbol SAP.

On December 18, 2000, Saputo Inc. announced that it has entered into an agreement to acquire the fluid-milk (``Dairyland'') and cheese operations (``Armstrong'') as well as certain joint venture interests of Agrifoods International Cooperative Limited, more commonly known as ``Dairyworld Foods''. This agreement, which has been approved by the Agrifood board of directors, is subject to ratification by the cooperative's delegate body at a meeting to be held in mid-January 2001. The transaction, subject to the usual conditions (including approval by the Competition Bureau), is expected to be finalized by the end of January 2001.

    OPERATIONS
    _________________________________________________________________________
    SAPUTO

    Revenues:              C$2 billion (US$ 1.32 billion)
    EBITDA:                C$267.6 million (US$176 M)
    Employees:             5,250
    Production facilities: 31

    Note: Based on Saputo Inc. 6 months results ended September 30, 2000,
    annualized
    _________________________________________________________________________

    _________________________________________________________________________
    Dairyworld
    Foods

    Revenues:              C$1.4 billion (US$920 M)
    EBITDA:                C$61.4 million (US$40.4 M)
    Employees:             3,200
    Production facilities: 24

    Note: Based on Agrifoods International Cooperative Limited 9 months
    results ended September 30, 2000, annualized
    _________________________________________________________________________


    STRATEGIC RATIONALE
    _________________________________________________________________________
    - This acquisition will give Saputo:
       - Greater geographic breadth (plants in 8 Canadian provinces);
       - An important presence in the national Cheddar market;
       - A significant participation in the Canadian Process cheese market.
    - This acquisition will confirm Saputo's status as a consolidator in the
      ongoing rationalization of the North American dairy industry.
    - This acquisition will allow Saputo to be a full-fledged participant in
      every segment of the dairy industry, except for ice cream.
    - This acquisition will enable Saputo to realize cheese production in
      order to maximize the efficiency of the combined company.
    - This acquisition will benefit from Saputo's manufacturing focus and low-
      cost production expertise.
    - This acquisition will give Saputo access to a significantly larger milk
      pool.
    - This acquisition will offer an opportunity to fully leverage Saputo's
      owned and operated Canadian distribution system.
    _________________________________________________________________________


    TRANSACTION PARAMETERS
    _________________________________________________________________________
    - Purchase price:      C$407 million (US$268 million) on a debt-free
                           basis
    - TEV/EBITDA:          6.6 x annualized 9 months ended September 30, 2000
                           EBITDA
    - Financing:           Bank indebtedness
    _________________________________________________________________________


    FINANCIAL INFORMATION
    _________________________________________________________________________
    Pro Forma Consolidated Income Statement
    _________________________________________________________________________
    C$ millions, except per   Saputo(1)     Dairyworld  Adjustments   Total
     share amounts                           Foods(2)      (3)      Combined
    _________________________________________________________________________
    Revenues                  $1,966.90     $1,420.00         -    $3,386.90
    EBITDA                      $267.60        $61.40         -      $329.00
    EBITDA Margin                 13.60%         4.30%        -         9.70%

    Depreciation                 $48.90        $14.50         -       $63.40
    Interest                     $38.00             -    $27.60       $65.60
    Earnings Before Income
     Taxes and Amortization
     of Goodwill                $180.70        $46.90   ($27.60)     $200.00
    Income Taxes                 $57.10        $17.80   ($10.50)      $64.40
                             __________    __________  _________   __________
    Earnings Before
     Amortization of Goodwill   $123.60        $29.10   ($17.10)     $135.60
    Amortization of Goodwill     $12.70             -     $5.70       $18.40
                             __________    __________  _________   __________
    Net Earnings                $110.90        $29.10   ($22.80)     $117.20

    Cash Flow                   $186.80        $43.60   ($17.10)     $213.30
    _________________________________________________________________________
    Per Share (fully diluted)
    Earnings Before Amortization
     of Goodwill                  $2.33                                $2.56
    Net Earnings                  $2.09                                $2.21
    Cash Flow                     $3.53                                $4.03

    Millions of Shares
     Outstanding
       Basic                       51.2                                 51.2
       Fully diluted               52.9                                 52.9
    _________________________________________________________________________

    - Acquisition is accretive to EPS by $0.23 (exluding $0.11 of goodwill
      amortization)
    - 14% increase in CFPS or $0.51 per share.

    (1) September 30, 2000 first semester results of fiscal 2001
        on an annualized basis.
    (2) September 30, 2000 nine-month results of fiscal 2000
        on an annualized basis.
    (3) Purchase price of C$407 million financed through
        bank indebtedness.


    COMPANY INFORMATION
    _________________________________________________________________________
    SAPUTO INC.

    Head Office:           6869 Metropolitain Blvd.East, Montreal, Quebec,
                           H1P 1X8 Canada
                           Lynda Leith, Director of Communications
                           Telephone: (514) 328-3381  Fax: (514) 328-3364
                           e-mail: lynda.leith@saputo.com
    Internet:              www.saputo.com
    TSE symbol:            SAP
    Shares outstanding:    51.2 million
    Recent share price:    C$32.75 (December 15,2000)
    Market capitalization: C$1.677 billion
    _________________________________________________________________________