TORONTO, Oct. 21, 2013 /CNW/ - Maple Leaf Foods (MFI: TSX) today announced that it is exploring strategic alternatives for its Bakery business, including a potential sale of the Company's 90% ownership interest in Canada Bread Company, Ltd. ("Canada Bread")
Maple Leaf embarked on a strategy seven years ago to increase scale, productivity and profitability in its protein operations. The Company is now in the final phase of executing this strategy, which is on track to be completed by 2015 and is expected to deliver significant returns to shareholders.
Maple Leaf has recently completed a comprehensive review of opportunities to accelerate profitable growth across its global Bakery business, which it conducts through its 90% owned subsidiary, Canada Bread. Before committing organizational focus, investment and resources to implement this strategy, Maple Leaf's Board and management have decided to explore other strategic alternatives, including a sale of the Company's 90% interest in Canada Bread, a process that is expected to conclude in early 2014. There are significant growth opportunities in the baked goods sector that may be pursued, either as part of Maple Leaf or under new ownership. Maple Leaf believes that either outcome would result in a strong commitment to realizing the full potential of this business.
"We are confident that our Bakery business can deliver significantly higher levels of profitable growth; the only question is how best to realize the future value of this business," said Michael H. McCain, President and CEO. "The recently completed Bakery strategy will require organizational focus and resources to implement. This process gives us the opportunity to determine the best path forward for Maple Leaf, our shareholders and our Bakery business."
David L. Emerson, Chair of the Maple Leaf Board, said, "The Board and management are united in supporting this process, which will ensure we make the best decision for Maple Leaf while continuing to pursue the significant growth opportunities in our value- added, branded meat business."
Maple Leaf has established a committee of independent directors to oversee the process and recommend the use of proceeds in the event of a sale, which may include a combination of debt repayment, reinvestment in the business and returning capital to shareholders.
There can be no assurance that the process being undertaken by Maple Leaf will result in the consummation of any transaction. No decision to sell Maple Leaf's interest in Canada Bread has been made and Maple Leaf may ultimately conclude that it will not sell its interest in Canada Bread. After completion of the conference call referenced below, Maple Leaf does not intend to comment further regarding the process being undertaken until such time that it deems disclosure appropriate.
Investor Conference Call Details
Maple Leaf Foods will host a conference call with the investment community today October 21, 2013 at 10:00 am ET to discuss this announcement. To participate in the conference call, please call 416-695-7806 / 1-888-789-9572, Passcode 7824681. A playback will be made available following one hour after the event at 905-694-9451 / 1-800-408-3053, Passcode 7763765. If you are unable to participate, the webcast will be archived and available on the Company's website at www.mapleleaffoods.com under the Presentations & Webcasts section.
About Maple Leaf Foods
Maple Leaf Foods Inc. is a leading food processing company, headquartered in Toronto, Canada. The Company employs approximately 19,500 people at its operations across Canada and in the United States, the United Kingdom, and Asia.
About Canada Bread
Canada Bread is a leading manufacturer and marketer of value-added flour based products, including fresh bread, rolls, bagels and sweet goods, frozen partially baked or par-baked breads and bagels, and specialty pasta and sauces. The Company markets products under a number of leading brand names, including Dempster's®, Olafson's, POM®, Ben's® and Olivieri®. The Company is 90% owned by Maple Leaf Foods Inc. and its common shares are listed on the Toronto Stock Exchange under the ticker symbol CBY.
Forward Looking Statements
This document and statements made in the above noted conference call may contain "forward-looking information" within the meaning of applicable securities law. Such statements include, but are not limited to, expectations regarding the timing and outcome of the protein transformation strategy including the delivery of significant returns to shareholders, expectations regarding the timing and outcome of Maple Leaf's strategic review of its Bakery business including realizing the full potential of this business, whether or not a sale transaction will be completed and any use of proceeds flowing from a completed sale transaction. These statements are not guarantees of future events and involve assumptions and risks and uncertainties that are difficult to predict. Actual results may differ materially from those expressed, implied or forecasted in such forward-looking information. Some of the factors that could cause actual results or outcomes to differ materially from the results expressed, implied or forecasted by such forward-looking information, including some of the assumptions used in making such statements, is discussed more fully in the Company's Annual Management's Discussion and Analysis for the period ended December 31, 2012 including the section entitled "Risk Factors", that are updated each quarter in the Management's Discussion and Analysis, and are available on SEDAR at www.sedar.com. Maple Leaf does not intend to, and Maple Leaf disclaims any obligation to, update any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
SOURCE Maple Leaf Foods Inc.