Irish-led food group Aryzta has announced its intention to buy out its partner in Canadian bakery company Maidstone for €349 million.
In its third major acquisition since June, Aryzta will acquire Tim Horton’s 50 per cent shareholding. Currently Maidstone exclusively services the Tim Hortons network under a contractual arrangement which extends to 2016 (or 2017 at Tim Hortons option) and may be extended beyond this point by mutual agreement.
The facility, based around a purpose built 400, 000 square foot bakery in Ontario, is operating at 55 per cent capacity. Aryzta said today that it plans to use the extra capacity to expand its customer base.
This is Aryzta's third North American acquisition since June when it bought Fresh Start Bakeries for $900 million and the pizza supplier Great Kitchens for $180 million, doubling its production capacity. Aryzta said that under its 100 per cent ownership, Maidstone "will be in a position to market Maidstone's spare capacity across all its customer channels with a particular focus on its recently expanded customer base from its acquisition of Fresh Start Bakeries."
Separately Aryzta announced that Fresh Start Bakeries is to invest in the region of $48 million (€36 million) in three bakeries in Asia (located in Taiwan, Singapore and Malaysia). It will also commence the construction of a new bakery in Brazil.
The group said these investments, along with Maidstone are expected to be earnings enhancing within twelve months. The group intends to finance the investments principally by issuing a hybrid instrument.
