Includes Mount Pearl facility
Scotsburn Co-operative Services Ltd. announced Friday it has an agreement with Saputo Inc. that will see the largest dairy processor in Canada acquire Scotsburn’s fluid milk activities, including facilities in Sydney, N.S., and Mount Pearl, as well as the fluid milk distribution network in Atlantic Canada.
Scotsburn Dairies in the Donovans Industrial Park. — Telegram file photo
“This wasn’t an easy decision to make, as fluid milk has been a core part of Scotsburn’s business since the mid-1960s,” said Doug Ettinger, president and chief executive officer of Scotsburn. “Where it has become more difficult for regional players to remain competitive in Atlantic Canada, this transaction will accelerate Scotsburn’s growth strategy on ice cream. Our milk business will realize its full potential and be positioned for success as part of Saputo — a company with an efficient processing and distribution network for fluid milk across Canada.”
The purchase price of the Saputo transaction is $61 million in cash, which excludes about $8 million of working capital. Specific details will be communicated to Scotsburn Co-operative members directly in advance of a vote on the agreement, which is expected later this month. Closing of the transaction is subject to satisfaction of relevant regulatory approvals, which includes approval from the Competition Bureau of Canada.
Final closing of the transaction is expected to occur in March.
“By changing our business model, Scotsburn is acting on a tremendous opportunity to build on our growth as a leading ice cream producer and supplier across Canada,” said Ettinger. “Increasing Scotsburn’s focus on ice cream also opens the door to growth throughout North America. This is good news for Scotsburn shareholders as this direction will result in strong returns for our co-operative members here in Atlantic Canada.”
TC Media—New Glasgow, N.S.