The federal government has granted approval for Maple Leaf’s
deal to sell its Rothsay rendering business to Darling International Inc. of
Irving, Texas.
Maple Leaf says the deal is scheduled to close Oct. 28 and
that it plans to apply the $645-million purchase price to paying off its debt. It's most recent quarterly report puts company debt at $1.3 billion.
Maple Leaf also says that once it completes its “prepared
meats strategy, management will consider appropriate deployment of excess
capital.”
The company is nearing completion of a meat-processing
facility in Hamilton that, once it’s operating at full steam, will enable Maple
Leaf to close a number of smaller and older plants scattered around Ontario.
The biggest of those is the J.M. Schneider plant in
Kitchener that employed about 2,300 people when Maple Leaf announced its plans
for Hamilton.
Maple Leaf has completed a similar strategy for its bakery
business, consolidating operations at a new plant at Hamilton.
Maple Leaf says its options for left-over money from the
Rothsay sale include “reinvesting in its core consumer packaged food
businesses or returning excess capital to shareholders.”
Rothsay was a stratetic fit for Maple Leaf when
it was the biggest livestock-slaughtering business in Canada.
It has sold or closed all of its
beef-slaughtering plants, has only two hog-slaughtering plants left, one at
Brandon, Man., and the other at Lethbridge, Alta., and it recently sold its
turkey farming operations and hatchery in Ontario.
