Bimbo Bakery of Mexico has a deal to buy Canada Bread for $1.85 billion, which means Maple Leaf Foods, which owns 90 per cent of the shares will get $1.65 billion.
"This transaction maximizes the value of our investment in Canada Bread and focuses Maple Leaf on building its leadership in the consumer packaged meats business," said Michael H. McCain, president and chief executive officer.
"Grupo Bimbo is an excellent company with strong values and a global leadership position, with little overlap in our geographic markets.
“This makes for a highly complementary fit with our bakery operations and is expected to provide exciting opportunities for Canada Bread employees, customers and other business partners."
Maple Leaf will now concentrate on its meat-processing business which is nearing completion of a major set of investments.
It is opening a huge meat-processing plant at Hamilton that will consolidate operations from a number of smaller and older facilities, mainly the J.M. Schneider plant in Kitchener and plants in the Toronto area.
The company has already opened a new distribution centre at Highways 401 and 6 south of Guelph.
Bimbo Bakery, which has offices in Cambridge, gains the most modern bakery in Canada, finished a few years ago on a Hamilton site close to the new meat-processing facility.
That bakery was built to consolidate operations from a number of older and smaller facilities, most of them in the Toronto area.