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Maple Leaf to Close Sale of Burlington Pork Plant

by 5m Editor
10 November 2010, at 8:38am

CANADA - Maple Leaf Foods Inc. announced yesterday that it is proceeding with the sale of its pork processing operation, located in Burlington, Ontario, to an affiliate of Sun Capital Partners Inc.

Proceeds from the sale are estimated to be approximately $20 million. The transaction is expected to close within the next few days.

"This sale will complete the transformation of our fresh pork operations to focus our growth on branded, consumer-focused prepared meats and meals business," said Michael Vels, Chief Financial Officer of Maple Leaf Foods. "We are very pleased to have secured a buyer who will continue to operate the facility, providing ongoing employment to a highly skilled workforce, and an important market for Ontario's hog producers."

The transaction includes a long-term contract with Maple Leaf Foods' rendering operations. The Company's prepared meat operations in eastern Canada will continue to be an important customer for the facility.

Upon completion of this sale, Maple Leaf Foods will reduce its annual pork processing from over 7 million hogs in 2006 to approximately 4.3 million hogs, concentrated at its facility in Brandon, Manitoba. This highly efficient scale plant provides a high quality raw material supply for the Company's prepared meats business.