By Amanda Brodhagen, Farms.com
Agropur, Canada’s largest dairy company, will increase its U.S. processing capacity by 50 per cent with a deal to buy the dairy processing assets of Davisco Foods International.
The purchase price was not disclosed. But the company did say that it will finance the acquisition using existing cash resources and new credit providers.
“With over US$1 billion in annual sales, this acquisition is by far the largest transaction in Agropur 76 year history,” Serge Riendeau, president of Agropur said in a release.
Agropur also bought Sobeys, Safeway’s milk, yogurt and ice cream manufacturing operations in Western Canada for $356 million. The sale included a plant in Edmonton and one in Winnipeg and another in Burnaby, B.C.
The acquisition announced Tuesday, will add cheese processing operations in Le Sueur (Minnesota), Jerome (Idaho) and Lake Norden (South Dakota), an ingredients plant in Nicollet (Minnesota), plus sales offices in China, Singapore, Geneva and the Netherlands.
Privately held Davisco of Minnesota employs approximately 900 workers, and produces more than 170 million kilograms of cheese and 80 million kilograms of cheese and why products annually. Quebec-based Agropur cooperative is owned by more than 3,500 dairy farmers. It processes 3.4 billion liters of milk each year in its 32 plants across Canada and the United States.
Dairy product brands under the Agropur banner include: Natrel, Québon, OKA, Farmers, Central Dairies, Sealtest, Island Farms, Agropur Grand Cheddar, Olympic and iögo
The deal is expected to close August 1, 2014.