Sale of Quebec pork company's genetics division won't change its other operations says analyst

Wednesday, October 2, 2013

by SUSAN MANN

Once the sale of Aliments Breton Foods Group’s porcine genetics business is completed, the Quebec-based company will become a customer of the businesses’ buyer, the animal genetics company Genus.

As part of the sale, Aliments Breton has a long-term agreement to buy genetics exclusively from Genus’s global porcine business unit, PIC, Genus says in a Sept. 23 press release. Aliments Breton’s porcine genetics business is called Génétiporc. Aliments Breton is North America’s leading producer of organic and natural pork. Genus is a leading animal genetics company.

Kevin Grier, senior market analyst with the George Morris Centre, says the sale won’t change what Aliments Breton is doing in “terms of its marketing and production.”

As part of the agreement, Genus is buying Génétiporc’s U.S. and Mexican companies and certain assets in Canada – mainly the intellectual property, genetic nucleus herds of about 3,200 pure line sows and customer contacts – for US $30 million cash. Génétiporc’s Brazilian assets are being sold separately to a joint venture Genus has with a Brazilian company. The North American deal includes Genus’ assumption of (U.S) $5.6 million of debt, which will be repaid at or short after closing, the Genus release says. The deal is slated to close this month.

“Génétiporc represents an excellent fit with Genus’ core activities and has very similar values to Genus’ porcine global business unit, PIC,” the Genus release says.

In addition, Génétiporc has “built a solid reputation since it was established in 1984 across the Americas for porcine genetics with a particular emphasis on meat quality, product development, biosecurity and health, all of which are also areas of focus for Genus,” the release says. BF