Saputo strengthens its presence in the United Kingdom with an agreement for Wensleydale Dairy Products

Canadian dairy giant Saputo has further expanded its presence in the UK through mergers and acquisitions with a deal for cheese maker Wensleydale Dairy Products.

The transaction was priced at £ 23million (US $ 31.8million) and builds on Saputo’s May acquisition of dairy-free cheese maker Bute Island Foods, located on the Isle of Bute off the Scottish coast.

In 2019, Toronto-listed Saputo also bought cheese and butter maker Dairy Crest, owner of the Cathedral City and Davidstow brands.

Wensleydale Dairy Products produces a variety of cheeses, including the Yorkshire Wensleydale brand, using milk from local farms. It operates two factories in North Yorkshire employing around 210 people.

The most recent set of financial results available for Wensleydale Dairy Products was released last month and covers the year up to March 31, 2020. Sales for that year reached £ 34.8 million sterling, up from £ 31.9 million a year earlier.

However, the company recorded an operating loss of £ 1.2million, compared to an operating profit of £ 338,719 the year before. Wensleydale Dairy Products management reported increased amortization and pension charges. The company recorded a loss for the year of £ 1.3million, compared to a profit of £ 35,904 a year earlier.

Canadian Dairy Company President and CEO Lino Saputo said in a statement today (July 5): “Wensleydale Dairy Products is home to an immense amount of passion, care and tradition. Not only is it a well established UK company with high quality products and award winning cheeses, our corporate cultures are well aligned, and I am delighted to welcome the entire team to the Saputo family.

Saputo has said it will pay cash for the company debt-free and expects the deal to be completed later in July, subject to regulatory approvals. Wensleydale will be part of the British dairy division of the Montreal-based company.

Wensleydale added, “The shareholders and directors of Wensleydale Dairy Products are delighted to be able to announce this sale. Following the establishment of the company in 1992, we are extremely proud of the progress made over the past 29 years and would like to express our gratitude to all the staff, many of whom have been with us throughout its existence. We are now just as proud to hand over the reins to Saputo, and are confident that they will continue to build on the legacy built by our sadly deceased former CEO, David Hartley.

Mr. Saputo unveiled a new four-year strategic plan in June and reiterated his intentions to expand through mergers and acquisitions with an investment guideline of C $ 2.5 billion (C $ 2.02 billion). US dollars) to 3 billion Canadian dollars. At the time, the CEO noted that between two and four transactions were underway as part of Saputo’s plan to achieve a high-digit organic growth rate in Adjusted EBITDA, with an end goal of ” reach CAD 2.13 billion by the end of fiscal 2025, excluding M&A.

In the year ended March 31, this profit metric increased 0.2% to CAD 1.47 billion.

Saputo generated revenues during these 12 months of CAD 14.29 billion, a decrease of 4.3%. The UK has become a key market in Europe for Saputo following the 2019 deal for Dairy Crest. The large Canadian dairy company generated revenues in the UK in the most recent fiscal year of C $ 816 million, compared to C $ 6.1 billion in the United States and C $ 4.13 billion in the Canada.

Outside of Europe and North America, Saputo also operates in Australia and Argentina, which contributed CAD 3.22 billion to the group’s revenues.

New Zealand and the greater Oceania region could be potential targets for mergers and acquisitions after the CEO of Saputo indicated the possibility of entering those markets in June.

About Thomas B. Countryman

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