Maple Leaf Foods to sharpen sustainability focus with pork business spin-off

11 Jul 2024 --- Canadian sustainable protein player Maple Leaf Foods is splitting into two independent public companies — one focused on consumer packaged goods and the other catering to its pork business to advance its execution focus on sustainable meat.

Maple Leaf Foods will retain a 19.9% ownership position in the new Pork Company (yet to be named) and the two companies will enter into a pork supply agreement. The new Pork Company will supply Maple Leaf Foods with “high-quality, sustainable pork” at market prices, to meet the needs of its Prepared Foods business. 

Maple Leaf Foods will, in turn, provide the new Pork Company with brokerage services in North America and certain other services.

“This transaction is the start of a new era to unlock the full potential of two outstanding businesses, each with a distinct value proposition and growth opportunities,” says Curtis Frank, president and CEO of Maple Leaf Foods.

“As separate companies, Maple Leaf Foods and the new Pork Company will each have exciting prospects, a sharpened execution focus with its own dedicated management team, and the financial independence to pursue its own value creation strategy, all with an uncompromising commitment to safety and sustainability.”

The separation plan is approved by Maple Leaf Foods’ Board of Directors and is expected to be completed next year.

Leadership changes
Maple Leaf Foods will continue to be led by Frank as CEO, Adam Grogan as president and COO and David Smales as CFO. 

Maple Leaf's pork business is one of the largest producers of Raised Without Antibiotics (RWA) pork, which is supplied to the US and Canada. The new Pork Company’s CEO position will be taken by Dennis Organ, incoming CEO of the new Pork Company, who joined Maple Leaf Foods in February last year as the president of Maple Leaf’s Pork Complex.

“This is the right transaction at the right time as we move forward with our sustainability vision, seeking to create value for all stakeholders,” underscores Michael H. McCain, executive chair of Maple Leaf Foods.

Sustainable meat moves
Completion of the split will propel Maple Leaf Foods as a focused, purpose-driven consumer packaged goods company, supported by leading brands and market shares in both meat and plant protein.

“Global demand for sustainably produced protein is expected to grow significantly and we have built the right platform to unlock stakeholder value as we meet that demand,” observes Frank.

The new pork company is expected to unlock the significant growth potential of its “Raised Without Antibiotics” (RWA) pork business by investing in both organic and inorganic opportunities, including increasing volumes and optimizing operations and efficiencies. 

It is also a key supplier of RWA and conventional pork products to customers in Canada and the US.

“We have seen positive momentum in the business in recent quarters as pork markets continue to normalize following several years of material disruption, and we are extremely well-positioned as a standalone company to leverage our unique advantages to drive growth and generate value,” notes Organ.

In 2022, the company opened a poultry factory in Ontario, Canada, where chicken continues to be the most consumed and fastest growing meat protein.