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Maple Leaf Foods Inc. (TSX: MFI) (Maple Leaf Foods or the Company) today announced a plan to unlock significant value by separating into two independent public companies, each primed for growth and positioned to be a leader in its field.
Maple Leaf Foods will continue to pursue its vision to be the most sustainable protein company on Earth, now as a more focused, brand-led consumer packaged goods company that will meet the world’s growing need for sustainably produced protein. By spinning off its pork business, the name of which will be announced in the coming months, Maple Leaf Foods will unlock significant growth potential by unleashing a world-leading organization which produces sustainable meat the right way and can fully take advantage of its own unique business model to unlock its own significant growth potential.
Maple Leaf Foods will retain a 19.9% ownership position in the new Pork Company, and the two companies will enter into an evergreen pork supply agreement which will deliver value for both businesses, while also allowing them to pursue their individual value creation opportunities.
Under this agreement, the new Pork Company will continue to provide Maple Leaf Foods with a secure supply of high-quality, sustainable pork at market prices, to meet the needs of its Prepared Foods business, providing the new Pork Company a strong anchor customer while allowing it to grow its already material business with customers around the world. Maple Leaf Foods will in turn provide the new Pork Company with brokerage services in North America, as well as certain other services.
The plan to proceed with the separation, which is expected to be completed in 2025, has been approved by the Board of Directors of Maple Leaf Foods, on the recommendation of a Special Committee of the Board, composed entirely of independent directors, and has the full support of Maple Leaf Foods’ largest and controlling shareholder, McCain Capital Inc. and the McCain family.
Maple Leaf Foods will continue to be led by Curtis Frank, President and CEO; Adam Grogan, President and COO; and David Smales, CFO. The new Pork Company will go forward with a strong and experienced management team led by Dennis Organ, incoming CEO of the new Pork Company. Mr. Organ joined Maple Leaf Foods in February 2023 as President, Pork Complex, and is a distinguished industry executive with more than 27 years of experience in the food industry, including 11 years with Smithfield Foods, where he held a variety of senior leadership roles, including Chief Operating Officer and Chief Executive Officer.
“The new Pork Company will offer investors direct access to one of the world’s foremost, premium value-added pork producers with a clear vision to produce meat the right way while delivering industry-leading financial performance,” said Mr. Organ, President of Maple Leaf Foods’ Pork Complex and incoming CEO of the new Pork Company. “We are already setting the standard for best practices in sustainability, animal welfare, and high-quality pork production. We have seen positive momentum in the business in recent quarters as pork markets continue to normalize following several years of material disruption, and we are extremely well-positioned as a standalone company to leverage our unique advantages to drive growth and generate value.”
July 9, 2024 - Maple Leaf Foods
