23 December 2014 | News | By Bureau Report
SunOpta, a leading global company focused on natural, organic and specialty foods products based Canada, has signed a definitive agreement to sell its fiber and starch business to J Rettenmaier & Söhne Group (JRS) for $37.5 million, subject to certain post-closing adjustments.
“The sale of our fiber and starch business aligns with our stated strategies and enhances our focus on the faster growing areas of our business that fit our vertically integrated business model, leveraging our global sourcing and supply capabilities,” said Steve Bromley, Chief Executive Officer (CEO), SunOpta.
“While the fiber and starch business offered limited synergies with our core business, we believe that JRS is well positioned when it comes to fiber and customized ingredients and will be able to scale the business, which should serve the industry well and be positive for our transitioning employees.” he added.
The fiber and starch business accounted for approximately 4% of SunOpta Foods’ total revenues in fiscal 2013 and during the first three quarters of 2014. SunOpta will continue to operate both its integrated grain and fruit-based ingredient platforms which were not part of the sale and currently form the remainder of the Value-Added Ingredient segment.
SunOpta will use the proceeds from the sale to make strategic investments that enhance its core vertically integrated product portfolio and provide greater growth and margin opportunities, such as its recently announced $25 million aseptic facility expansion in Allentown, Pa., and also for general corporate purposes. Completion of the sale is subject to certain conditions and pre-closing matters and is expected to close in the next 30 days.