Bimbo said Dec. 10 it will buy the U. S. bread-making unit of George Weston Ltd. for US$2.38 billion, one of the biggest acquisitions in the Mexican bread-maker’s history.
Bimbo, one of the world’s top makers of bread, said it would finance the acquisition using a long-term credit of $1.7 billion, in two tranches, and a $600 million bridge loan with a one-year maturity (all figures US$).
Pending authorization from regulatory authorities, the deal is expected to close in the first quarter of next year.
The U. S. operation, Weston Foods Iwnc., will give Bimbo access to the Boboli, Brownberry, Entenmann’s, Freihofer’s, Stroehmann and Thomas’ brands of breads, rolls, muffins and bagels and strengthen its presence in the eastern U. S.
For Weston, the Torontobased owner of the Loblaw Companies, this sale marks the second such transaction this year, after it closed the sale of its Neilson Dairy operations to Saputo on Dec. 1.
“Having sold both the dairy business and the U. S. fresh baking business at good multiples, we will sit at George Weston Ltd. with strategically well-positioned companies with leading market positions in food retail and baking in Canada and a significant sum of cash,” the company said in a release. “We intend to use that cash wisely and at the appropriate time.”