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Viterra To Buy Manitoba Canola Crusher

The “cold-press” canola crushing plant at Ste. Agathe is becoming the latest acquisition for Canada’s largest grain company.

Viterra announced Monday it will buy the Associated Proteins plant in the industrial park on the community’s west side for $64 million plus “working capital.”

Pending approval from the federal Competition Bureau, the company said it expects the sale to close June 25.

The Associated Proteins facility has a crush capacity of 1,000 tonnes per day, and “with immediate access to North America’s major rail lines, is well situated to source raw materials domestically and supply North American end-use markets,” Viterra said.

Viterra described the Ste. Agathe facility as “a scalable operation with future growth and expansion opportunities to service the growing markets for healthy vegetable oils.”

The Regina grain company said it expects “significant growth” in canola oil sales as canola replaces soy oil in food applications.

Unlike conventional canola crushing, which uses solvents to extract as much oil as possible from the seed, cold pressing uses only mechanical expellers, leaving a higher-oil, high-energy meal as its byproduct. The Ste. Agathe plant remains the largest of its kind in the world.

Karl Gerrand, Viterra’s senior vice-president for food processing, said in an interview Monday from Ste. Agathe that the company is undecided whether to maintain the plant’s cold-press operations or convert it to the conventional hexane extraction method, although it sees no technical issues preventing such a conversion.

Gerrand, however, described the current operation as a “premier supplier” of cold-press oil to health-conscious consumers across North America.

Viterra CEO Mayo Schmidt said in a release Monday the acquisition “bolsters our presence in food processing and complements our position as Canada’s leading canola exporter” and “is consistent with our overall strategy to grow our company’s value-added capabilities.”

“Through this transaction, we will be able to further leverage our value chain to meet increased crush demands and supply an expanding healthy vegetable oil market,” Gerrand said in the same release.

The Ste. Agathe plant’s management and staff have “an impressive track record of execution and we look forward to working together to grow the business and its customer base,” he said.

The Associated Proteins plant rose at Ste. Agathe in 1998 under the ownership of a Kincardine, Ont. company, Canadian Agra Foods Inc., which pledged to develop markets for its “cold-press” canola oil.

Under Canadian Agra’s ownership, however, the plant was mothballed before going into production. The Bank of Nova Scotia petitioned Canadian Agra into bankruptcy in 1999 two years after telling the company’s president and CEO Helmut Sieber to find alternative financing.

Ellis-Don, the general contractor for the plant’s construction, wound up as the plant’s owner, and entered a partnership with Associated Proteins in 2004 to restart production.

Associated Proteins took full ownership of the plant in 2005 and by 2006 was considering plans to double its processing capacity to 2,000 tonnes of canola per day. Gerrand said the company has yet to decide when or whether to proceed with capacity expansion.

The plant briefly made headlines outside the business pages for an explosion and fire in one of its press-cake coolers in April last year, temporarily halting production at the plant. [email protected]

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Editor, Daily News

Dave Bedard

Writer and editor. A Saskatchewan transplant in Winnipeg.

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