Maple Leaf Foods is spinning off its pork business as the Canada-based protein company splits into two public-listed entities.
In a move designed to “unlock significant growth potential”, Maple Leaf said a new name for the pork operations will be announced in due course. The separation is expected to be completed next year.
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President and CEO Curtis Frank said: “This transaction is the start of a new era to unlock the full potential of two outstanding businesses, each with a distinct value proposition and growth opportunities.
“As separate companies, Maple Leaf Foods and the new pork company will each have exciting prospects, a sharpened execution focus with its own dedicated management team, and the financial independence to pursue its own value-creation strategy.”
Maple Leaf will hold a 19.9% interest in the new pork company, which will continue to supply the parent business.
The board and Maple Leaf’s largest shareholder, the McCain family and owner of the Canada-based French fries brand, have approved the separation.
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By GlobalDataFrank will continue to lead Maple Leaf, while Dennis Organ will be appointed CEO of the pork business. The former Smithfield Foods' executive has been with the Canada company since 2023, overseeing its pork operations.
Executive chair Michael McCain said: “I am passionate about both of these businesses and have absolute confidence in the powerful potential of this transaction.
“Our shareholders will be able to participate in not one, but two strong, independent, sustainable and purpose-driven businesses, each with a clear mandate and investment profile, and all our stakeholders will participate in the shared value we will generate.”
Maple Leaf in its existing set up delivered sales last year of C$4.9bn ($3.5bn). The company operates 23 manufacturing plants in Canada and the US and offers branded meat and private label to retail and the foodservice channels.
Outside of pork, the other business will house the meat and alternative-protein assets. The latter includes the Field Roast and Lightlife brands.
Animal meat lines feature the company’s namesake brand and Schneiders, among others, including poultry.
Maple Leaf said the new pork company will be “well positioned to unlock the significant growth potential of its business by investing in both organic and inorganic opportunities”.
Based on an estimate for the fiscal year to 31 March 2024, the pork business is likely to have an adjusted EBITDA of around C$70m or C$180m “when adjusted for normal market conditions”.
