Tyson and XL Foods to Complete Lakeside Sale by Mid-March

Lakeside Farm Industries, based in Brooks, Alberta, is a diversified agribusiness involved in cattle feeding, slaughtering and processing, as well as retail fertilizer production and farming.

02/03/09 The sale of Lakeside Farm Industries by Tyson Foods, Inc. to XL Foods Ltd. is expected to be completed by mid-March, officials from both companies have reported. The transaction, which was first announced in June 2008, is proceeding now that the Canadian Competition Bureau has indicated it will not challenge it.

“We’re pleased the Competition Bureau has finished its review and we’re ready to move forward with the sale,” said Leland Tollett, interim president and CEO of Tyson Foods. “As we’ve previously stated, Lakeside is one of Canada’s leading beef processing operations, but it simply no longer fits our company’s long-term strategy.” Tyson’s current international focus is primarily on expanding the company’s presence in Asia, Mexico and South America.

“While Tyson will no longer own a beef plant in Canada, we fully intend to continue buying Canadian cattle to supply some of our U.S. beef operations, such as our beef complex in Pasco, Washington,” according to Tollett.

The C$105.5 million sale of Lakeside includes C$55.5 million that will be paid at closing. The remaining C$50 million, plus interest, will be paid over a five-year period following closing. XL is also buying cattle, feed, fertilizer and packaging inventories as part of the transaction.

“We’re anxious to make the Lakeside part of our company and believe it will complement our other Canadian operations,” said Brian Nilsson, co-chief executive officer of XL Foods Inc.

Lakeside Farm Industries, based in Brooks, Alberta, is a diversified agribusiness involved in cattle feeding, slaughtering and processing, as well as retail fertilizer production and farming. Lakeside employs 2,300 people and we appreciate the patience they’ve shown as we have worked through the details of this change in ownership.

The Lakeside beef plant currently has the capacity to slaughter and process 4,700 cattle per day. The commodity boxed beef produced by the plant is primarily sold to customers in Canada and the U.S.

XL Foods Inc. is the largest Canadian owned and operated beef processor in Canada. It is part of the Nilsson Bros. Group of companies, which is a diverse agri-business that is involved in all facets of beef and cattle production, marketing and processing. XL Foods Inc. operates facilities in Alberta, Saskatchewan, Nebraska and Idaho.