A pair of Ontario meat processors with “iconic” brands in Canada are among four firms to be picked up on the most recent shopping expedition by specialty food firm Premium Brands.
Vancouver-based Premium announced Friday it will pay a total of $227 million in cash, shares and promissory notes for four companies: Concord Premium Meats, The Meat Factory, Country Prime Meats and Frandon Seafood.
Premium CEO George Paleologou, in the company’s fourth-quarter earnings report on Friday, said the company is “very excited about all of these businesses both on a stand-alone basis as well as the potential synergies between them and our legacy businesses.”
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All four firms, he said, have “best-in-class management teams, modern well run facilities, entrepreneurial cultures and, in the cases of Concord and The Meat Factory, leading iconic brands.”
Premium didn’t say what it will pay for each company separately, but noted its deal for Concord Premium Meats is subject to approval from the federal Competition Bureau.
The Competition Bureau calls for advance notice of proposed deals when a target firm’s assets in Canada — or its revenues from sales in or from Canada generated from those assets — are valued above a given threshold, which for 2018 is set at $92 million.
The Concord deal is thus expected to close in the second quarter of this year, pending bureau approval. The deals for The Meat Factory, Country Prime Meats and Frandon are all expected to close in the next two weeks.
Set up in 1993 and based at Vaughan in the Greater Toronto Area, Concord Premium Meats operates federally inspected further-processing plants at Vaughan, Mississauga and Brampton and at St-Eustache, Que.
Concord’s plants make beef, poultry and pork products including deli meats, burgers, roasts, steaks and kabobs, among others, for the retail and foodservice sectors. Its brands include MarcAngelo, Skoulakis, Central Park Deli, Black River Angus and Connie’s Kitchen.
The Meat Factory, or TMF Foods, founded by Lou Albanese, operates a federally inspected 85,000-square foot plant in the Stoney Creek area of Hamilton and makes beef, pork and poultry products under the Lou’s Barbeque and Peameal Bacon of Canada brands.
Country Prime Meats, founded by the Springmann family in 1996, processes pork into various pepperoni meat snacks at Lac la Hache, B.C., about 220 km northwest of Kamloops, selling nationwide and into the U.S.
Frandon, based at St-Laurent, Que., distributes seafood products such as fresh fish, crab, shrimp, lobster, squid, scallops and frozen goods such as beverages, desserts, chicken and appetizers in the Montreal area.
Paleologou, in Friday’s year-end report, said the company “continue(s) to pursue a wide variety of acquisition opportunities and expect(s) 2018 to be our busiest year yet for transactions.”
‘Unexpected headwinds’
Premium on Friday booked full-year earnings of $80.5 million on “record” full-year sales of $2.198 billion for 2017, up from $68.8 million on $1.858 billion in 2016.
Fourth-quarter earnings came in at $17.2 million on $585.4 million in revenues, down from $20 million on $532.6 million in the year-earlier Q4.
“In terms of the fourth quarter, while we continued to generate record sales and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), our results were below our potential due to certain unexpected headwinds,” Paleologou said.
“In particular, very tight labour markets across North America created unusual operating challenges for many of our businesses as well as those of our supply chain partners. These challenges included higher employee turnover rates and in some cases labour shortages.”
Premium, which operates plants and distribution centres in seven provinces and seven U.S. states, is “confident that we are taking all of the necessary steps needed to adjust to this new environment,” he said. — AGCanada.com Network
