New owners for Leamington plant

Thursday, February 27, 2014

by SUSAN MANN

It’s good news that H.J. Heinz Company of Canada Ltd. announced today it has signed a letter of intent to sell its Leamington plant to Canadian company Highbury Canco Corporation, says an Ontario Processing Vegetable Growers spokesman.

Chairman Jim Poel says the proposal from Highbury Canco Corporation, formed by a group of investors and current managers at the plant, is the one the board supported. Juice will be the new owners’ main product.

“The growers certainly appreciate that there’s the opportunity to continue growing tomatoes.” Poel says. “We’re glad to support this venture.”

In Heinz’s Feb. 27 news release, Michael Mullen, senior vice president of corporate and government affairs, says Heinz received many expressions of interest in the facility. “We are pleased we were able to identify a strong new partner for the community and for Heinz.”

In November 2013, Heinz announced it was closing the 104-year-old facility in a staged process to be completed by June. It was making ketchup, beans, baby food and juice.

Highbury Canco will act as a co-packer for Heinz. Highbury spokesperson Pradeep Sood says in the Heinz release that under the terms of the letter of intent it will continue manufacturing “certain identified Heinz products and as well provide certain distribution and logistics services to Heinz in Canada.”

In a telephone interview, Sood says the company will be mostly making tomato juice along with beans and other products but not ketchup. “What we want to do is manufacture for Heinz and also for a private company” and they also have the option to create their own brand, he says.

Highbury Canco is buying the Leamington plant, the land it sits on and the equipment in the facility, he notes, adding they intend to operate it year round.

The deal is expected to be finalized within two months at the most. “We need to work on it quickly because of the tomato season,” Sood says. In the news release he notes Highbury Canco will work with all of its strategic partners including local farmers, the workforce, the local community and all levels of government to finalize the agreement with Heinz.

Sood says he’s not at liberty to discuss the purchase price because the deal hasn’t closed yet. “We really don’t know what it’s going to be at the end of it all.”

As for how many tomato growers they will need, Sood says he doesn’t know the number yet “but we do need the tomatoes and there will be growers at work.” Highbury Canco will be working with Heinz to determine the number of growers it will need.

Mullen couldn’t be reached for comment.

Heinz says in the release the signing of the letter of intent is subject to the successful completion of the full transaction.

The change of ownership of the Leamington plant doesn’t impact the processing tomato negotiations between the vegetable board and processors going on now, as they do every year. Poel says the board negotiates a fair and competitive price for raw tomato product regardless of what company buys the product. “We’ll certainly work together with this new entity to negotiate a fair price,” he explains.

Economic Development, Trade and Employment Minister Dr. Eric Hoskins says in a Feb. 27 statement sent by his representative Gabe De Roche by email that he’s “very glad with the joint announcement by Heinz and Highbury Canco Corporation that the Leamington facility will continue operations.” Hoskins says he’s also “very pleased that our government played a leading role in bringing these two companies together to ensure a brighter future for the Leamington facility.” BF