Parmalat Group has reached an agreement to acquire the natural cheese division of Kraft Heinz Canada. The transaction, if approved, would mean that Parmalat Canada will take on stewardship of iconic Kraft Heinz Canada cheese brands: Cracker Barrel, P'tit Quebec and aMOOza! Parmalat Canada has been producing natural cheese since 1881.
This acquisition, if approved, would also include a processing plant in Ingleside, Ontario and its almost 400 employees. The transaction is valued at $1.62 billion.
Parmalat has listed some of the significant aspects of the transaction:
- Parmalat is uniquely positioned for this transaction as natural cheese is at the core of its business.
- The transaction is a significant investment in Canadian dairy and is a vote of confidence in Canada's dairy industry that Parmalat says will provide important benefits to Canada.
- If approved, the transaction will both secure and grow cheese production in Canada and make Parmalat Canada a more competitive company, which in turn will help protect jobs and support dairy farm incomes.
- The proposed transaction will also help key customer partners – both retail and foodservice – as they seek to meet growing demand from consumers.
- Each of the brands in Parmalat’s portfolio, and the brands it will be acquiring, will remain distinct. “Each will remain active and vitally important to our company, as they have always been for each and every family who buys our nutritious dairy products,” the company says.
- The transaction, coupled with further planned investment, is expected to produce synergies with the existing Parmalat Canada manufacturing and distribution network which Parmalat says in turn could lower costs, will protect jobs and support dairy farm incomes.
- The Ingleside plant fits well into Parmalat Canada’s current network and helps expand its operations in Eastern Canada. Along with existing processing facilities in Winchester and Belleville, ON and Victoriaville, QC (all three of which will remain open post the closing of this transaction), Parmalat Canada says it is well positioned for future growth.
- Parmalat Canada says it can use the new Ingleside site to improve efficiencies and grow the business. The brands being acquired have wide brand recognition and offer channels for business expansion.
- The transaction will Parmalat to utilize more of the milk ingredients it produces, making the business more self-sufficient and reducing waste.
- “This proposed transaction represents a strong commitment to Parmalat's Canadian business,” the company says. “It builds on our current Canadian footprint, which includes nearly 3,000 employees, 16 dairy processing plants and a dedicated Research & Development facility.”
"Today's announcement speaks volumes about our drive to support dairy farmers, help the local economy and continue to build on our family tradition of cheese making," said Parmalat CEO and president Mark Taylor. "We are excited to work closely with the community and our stakeholders to ensure we can grow sustainably and help Canada's natural cheese business thrive. Parmalat's brands in Canada date back as far as 1881 [Balderson]. This deep-rooted heritage in Canada makes the proposed transaction a logical step for us as we seek to make an even more significant economic and social contribution in Canada."
Under the terms of the agreement, Kraft Heinz will sell its production facility located in Ingleside, Ontario. Kraft Heinz Canada will also transfer approximately 400 employees from that facility to Parmalat.
Kraft Heinz will continue to own and market its other cheese products, including Philadelphia, Cheez Whiz and Kraft Singles, which are processed in Mount Royal, Quebec, where Kraft Heinz Canada has about 900 employees.