Mexican baker Grupo Bimbo has entered into an agreement to acquire Canada Bread, the bakery business majority-owned by Canadian food group Maple Leaf Foods.
Bimbo will pay C$1.83bn (US$1.66bn), or C$72 a share, for the company. Including the C$8 per share dividend paid by Canada Bread to its shareholders last month, the company said the price represents a 31% premium on its stock price as of 18 October, the day before Maple Leaf announced it was considering strategic options for the baker.
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In an announcement, Maple Leaf emphasised the agreement was the result of an “exhaustive process” to secure the best possible price for the business. US baker Flowers Foods was reportedly among the other interested parties.
Maple Leaf holds approximately 90% of Canada Bread’s shares and has thrown its weight behind the deal – which would be dependent on the approval of two-thirds of shareholders.
Commenting on the agreement, Canada Bread president and CEO Richard Lan said the acquisition was an “excellent outcome” for the company. “Becoming part of Grupo Bimbo, the world’s leading bakery company and benefiting from its focus, expertise and resources, will create new opportunities for our people, customers and business partners.”
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