Olymel, a processor and distributor of pork and poultry products in Canada, has acquired the Canadian assets of hog producer Big Sky Farms for C$65.25m ($65.7m).
Olymel noted that this acquisition is a strategic response to the challenge of hog supplies in western Canada.
The acquisition includes facilities located in Canada, primarily in Saskatchewan, the breeding herd and boar studs, the genetic nucleus and finishing sites, as well as feed mills and transport activities.
Big Sky Farms entered into bankruptcy in September 2012 as it was unable to meet its obligations after significant losses, mainly due to increased animal feed prices and depressed hog prices. Ernst & Young, the court-appointed receiver of Big Sky Farms, and Olymel then entered into a purchase and sale agreement on 16 October.
Olymel president and CEO Réjean Nadeau said that acquisition is in line with the company's policy of strengthening the capacity of the processing and value-added product manufacturing plants, for both the domestic market and export outlets.
"Although this is its first foray into the swine production industry, Olymel plans to draw on the expertise of its owners who are already involved in the production sector to take advantage of all possible synergies in order to integrate Big Sky Farms into its operations," Nadeau added.
Big Sky Farms, founded in 1995, has annual production of one million hogs and employs more than 400 people.
Big Sky Farms has been a leading supplier to the Olymel hog slaughterhouse and butchering plant in Red Deer, Alberta, which employs more than 1,300 persons and has a weekly slaughtering capacity of 90,000 hogs. Olymel also stated that in addition to supplying hogs to its Red Deer plant, Big Sky Farms will maintain its business relations with the company's customers and suppliers.
Olymel is involved in slaughtering, processing and distribution of pork and poultry with operations in Quebec, Ontario, Alberta, Saskatchewan and New Brunswick.
