Agropur buying Davisco dairy assets; third acquisition in July
Agropur's acquisition of Davisco Foods' dairy processing assets comes after two other deals in month
LONGUEUIL, Que.—Quebec-based dairy co-op Agropur continued with its busy month in July, announcing another major acquisition in its push to keep pace with the global marketplace.
A week after announcing plans to buy the dairy and distribution assets of New Brunswick’s Northumberland Dairy Co-operative, and about two weeks after buying Sobeys Inc.’s western Canadian milk, yogurt and ice cream manufacturing operations, Agropur announced plans to buy the dairy processing assets of United States-based Davisco Foods International, Inc.
Financial details were not disclosed.
Set to close Aug. 1, the acquisition will double Agropur’s U.S. processing operations and boost its global milk intake by 50 per cent.
Agropur president Serge Riendeau call the deal “by far” the largest in the co-op’s 76-year history.
“This transaction, combined with the most recent ones in Canada, will increase our sales to over $5.8 billion on an annualized basis, and we should reach 5.3 billion litres of milk processed each year in 41 plants across North America,” Riendeau said in a statement.
The deal should put Agropur in the top-five cheese and ingredients processors in the U.S., he added.
Headquartered in Le Sueur, Minn., Davisco employs 900 people and processes 1.7 billion litres of milk, as well as 375 million lbs. of cheese, and 180 million lbs. of whey ingredients a year.
The acquisition includes three cheese processing plants—one each in Le Suer, Minn., Jerome, Idaho, and Lake Norden, S.D.—and distribution centres in Rotterdam, Netherlands, and Tianjin, China.
Agropur will also take over sales offices in Eden Prairie, Minn., Shanghai, Singapore and Geneva.
The Longueuil, Que.-based dairy co-op has been making an international push in recent months, announcing in November 2013 plans to acquire dairy products trading house M. Larivee International Inc.
Former Larivee owner Marcel Larivee was set to manage the newly-formed Agropur Export Group.
“The world dairy industry is consolidating at an accelerated pace and our acquisition of Davisco supports our objective of increasing our global presence,” Agropur chief executive Robert Coallier said.
“One of our key business objectives is to pursue strategic acquisitions to diversify our geographic markets and product portfolios. This acquisition, like our other recent ones, will help solidify the development and sustainability of our cooperative by securing a favorable strategic positioning at all national, North American and global levels.”