Mexico’s Grupo Bimbo Acquires Canada Bread for C$1.83B, Shares Up
By Esther Tanquintic-Misa | February 13, 2014 1:08 PM EST
Mexico's Grupo Bimbo SAB has acquired Canada Bread Company Limited for C$1.83 billion ($1.65 billion), the North American company announced on Wednesday.
India's GDP grew at a better than expected rate but growth concerns remain
Shares of Canada Bread immediately experienced a ripple effect, rising more than 7 per cent to C$72.15 on the news. Bimbo's, however, slid 1.5 per cent, down at 34.65 pesos in morning trade.
Canada's largest bakery business is owned 90 per cent by Maple Leaf Foods. With the arrangement, the latter now gets to focus on its meat business.
One of the world's largest bread makers, Grupo Bimbo will pay C$72 for Canada Bread share. The deal comes after Maple Leaf Foods announced four months ago its plans for a massive sweeping restructuring.
Grupo Bimbo effectively gains a position in the Canadian marketplace. It will now become the owner of popular brands Dempsters and Bon Matin, among others.
Moreover, the acquisition advances Grupo Bimbo's global growth strategy to extend its presence in Canada and United Kingdom, as well as to expand their distribution networks in the United States.
"Canada Bread enjoys strong relationships with key retailers in Canada and holds strong market positions in all bread categories. The company employs approximately 5,400 associates and operates 25 bakeries, as well as Canada's largest direct store delivery network for fresh bakery that reaches over 41,000 points of sale," Grupo Bimbo said.
"We are very pleased to announce the acquisition of Canada Bread for Grupo Bimbo, given it's a company with a strong commercial presence, recognized by customers and consumers for its products' high quality in the different bread categories," Daniel Servitje, Grupo Bimbo chairman and CEO, said.
The arrangement is expected to close in the second quarter of 2014, subject to regulatory approval.
Analysts expected the sell-off would be at least placed at $80 per share.
"We've got a great plan in front of us, and we're having a very rocky road in transition," CTV News quoted Michael McCain, Maple Leaf Foods president and CEO.
Maple Leaf Foods has already sold its Rothsay rendering business. Plans are underway to divest its commercial turkey farms, hatchery operation and breeding farms.
"I don't mean to minimize it, but it is transitional, and we're excited about the outcome when it's done."
To report problems or to leave feedback about this article, e-mail:
To contact the editor, e-mail:
Most Popular Slideshows
- 2014 MLB World Series Game 1: San Francisco Giants 7, Kansas City Royals 1 [PHOTOS]
- 2014 MLB World Series - Game 2: Kansas City Royals 7, San Francisco Giants 2 [PHOTOS]
- 2014 MLB World Series Game 3: Kansas City Royals 3, San Francisco Giants 2 [PHOTOS]
Join the Conversation
- Canadian Ebola Drug: Tekmira Firm Starts Limited Manufacturing of Vaccine, Available By December; Shares Up
- Australia's Low Birth Rate May Be Due to Low Confidence in Economy
- WHO Races to Release Ebola Serum in 2 Weeks, Vaccines in January
- Fears Of Infection Spread Prompt Some US Hospitals To Refuse Ebola Patients
- Readers Slam a Book Showing That US Wealth And Power Rests on Slave Labour
- Xiaomi Redmi 1S vs. Sharp Aquos Crystal – Specifications, Features And Price Showdown
- Boy Stoned To Death For Alleged Rape, Victim Receives Dowry From Militants
- Verizon Motorola Droid Turbo Leaked Live Images Surfaces, Scheduled To Get Unveiled On Oct 28
- Update HTC One M7 with LG G2 with Android 4.4.2 as Sprint OTA: Fixes and Installation
- Russia is Creating Underwater Combat Robots to Protect its Arctic Territories
- ‘Lone Wolf’ Attack on Canada Parliament Hill Could be ISIS-Related
- U.S. Targets Buyers of ISIS Oil, Threatens Sanctions