Canadian food processing and distribution company George Weston has sold its US fresh bakery business to Mexican baker Grupo Bimbo.

The purchase price totalled US$2.5bn, including around US$125m of interest baring assets.

The assets being sold include the Arnold, Brownberry, Entenmann’s, Freihofer, Stroehmann and Thomas’ brands.

In the fiscal ended 4 October, the businesses being sold generated revenues of $2.2bn and EBITDA of $255m.

George Weston said that it would report a “significant gain” on the disposal. However, a spokesperson for the company declined to comment on speculation that it is raising funds in order to take Canadian retailer Loblaw private.

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“We cannot comment on market rumour or speculation,” the spokesperson said.

George Weston already holds a controlling stake in Loblaw and the market has speculated that the group could use proceeds from the Bimbo deal to buy the 39.1% of Loblaw shares that it does not already hold.