Maple Leaf renews sale for Burlington pork processing plant
By Food in Canada StaffBusiness Operations Meat &Poultry Maple Leaf Foods pork processing
Maple Leaf Foods has announced it is re-launching the sale process for its pork processing facility in Burlington, Ontario. The sale of the Burlington plant will complete the last phase of what the company calls its “protein transformation journey,” a strategic refocus on processed and prepared meat products and away from fresh meat.
The Toronto-based company previously tried to sell the Burlington business in 2008. However, the deteriorating economic conditions and credit markets that existed at the time meant that the company was unable to complete a satisfactory sale, said Nick Boland, vice president of finance for Maple Leaf Foods, in an interview.
“We stopped the process and said we would re-engage it in 2010 and that’s where we are now. A number of people have reached out to us and we will now put them into a formal sale process. We’re going to approach a number of different companies—not only the ones that approached us, but people that we think strategically this might be a good fit for them.” The company’s goal is to complete the sale by the end of the year.
Maple Leaf formerly operated six pork processing plants across the country. Of the three that remain, the Burlington facility is the largest one that it plans to sell as the company reduces its exposure to the fresh meat business.
In 2007, Maple Leaf launched its “protein transformation journey” to shift the company’s focus onto “value-added” meat products such as bacon, hot dogs, ham, deli meats, meat snacks and lunch kits, said Boland.
“We believe we have the top two brands in processed meats in Canada, being Maple Leaf and Schneiders. We’ve got terrific market shares in all the major categories, and we think it’s something that we do very well. Whereas with fresh meat, we’re competing against a number of other countries that do the same thing. And as the Canadian dollar has increased in value, particularly against the US (dollar), we’ve become less competitive.”
Maple Leaf will retain its pork processing facility in Brandon, Manitoba, and use it as an input supplier for its value-added meat products, said Boland. The Brandon facility has been double shifted and is “well-positioned geographically near where a lot of pigs are grown where a lot of grain grows,” he said. The company also plans to divest itself of its smaller pork processing facility in Lethbridge, Alberta, once the sale of the Burlington facility is complete.
The Burlington plant has 1,000 employees and at 365,000 sq ft is one of the largest pork processing plants in the country. An expected selling price was not disclosed.
“It’s a profitable, very efficient facility with an excellent skilled workforce,” said Boland. “We believe we can sell it as a going concern. It’s just not aligned to our protein transformation.”
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