TORONTO, Nov. 15, 2021 /CNW/ - George Weston Limited
("George Weston" or the "Company") (TSX: WN) today announced that
it has signed a definitive agreement to sell the Weston Foods
ambient bakery business to affiliated entities of Hearthside Food
Solutions, LLC ("Hearthside") for aggregate cash consideration of
CAD$370,000,000.
"With the agreement to sell the ambient segment to Hearthside
and our previously announced sale of the fresh and frozen
businesses, we have two high-quality buyers that are
well-positioned to carry on the proud legacy of the Weston Foods
business," said Galen G. Weston,
Chairman and CEO of George Weston.
"With the sale of the entire bakery business, George Weston will be focused on its
market-leading Retail and Real Estate businesses going
forward."
"The Weston Foods acquisition is an ideal complement to our
existing production network and business, bringing baking capacity,
a roster of premier customers, expanded capabilities, and enhanced
geographic coverage. These synergies benefit our current and new
customers alike. We look forward to welcoming Weston Foods' 1,100
employees into the Hearthside family." said Chuck Metzger, Hearthside CEO.
George Weston announced on
March 23, 2021, that it decided to
sell its bakery segment and to focus on its Retail and Real Estate
businesses. On October 26, 2021,
George Weston announced that it had
entered into a definitive agreement to sell its fresh and frozen
bakery businesses to affiliated entities of FGF Brands Inc. for
aggregate cash consideration of $1.2
billion. Together with the sale of the fresh and frozen
business, the sale of the ambient business represents the
disposition of George Weston's
entire bakery business, for an aggregate value of $1.57 billion at a combined multiple of
approximately 10x the estimated 2021 EBITDA for the bakery segment.
The Company expects to return the net proceeds from the
transactions to shareholders through share repurchases over time.
In the interim, the Company is committed to ensuring that a smooth
transition plan is in place as Weston Foods continues to support
its customers and workforce.
The sale of the Weston Foods ambient business is subject to
compliance with the Hart-Scott Rodino Antitrust Improvements
Act of 1976 and other closing conditions customary in
transactions of this nature. Subject to the receipt of all
regulatory approvals and satisfaction of customary transaction
closing conditions, George Weston
expects to close the transaction before the end of the first
quarter of 2022.
Houlihan Lokey and CIBC Capital
Markets are serving as financial advisors to George Weston and Mayer Brown LLP and Torys LLP
are acting as legal advisors.
Ropes & Gray LLP and Stikeman Elliott LLP are acting as
legal advisors to Hearthside.
About Weston Foods' Ambient Bakery Businesses
The Weston Foods ambient business comprises a leading North
American manufacturer, serving retail and foodservice customers
with cookies, crackers, cones and wafers in Canada and the
United States.
About George Weston Limited
George Weston Limited is a Canadian public company founded in
1882. The Company operates through its three reportable operating
segments, Loblaw Companies Limited, Choice Properties Real Estate
Investment Trust and Weston Foods. Loblaw provides Canadians with
grocery, pharmacy, health and beauty, apparel, general merchandise,
financial services and wireless mobile products and services.
Choice Properties owns, manages and develops a high-quality
portfolio of commercial retail, industrial, office and residential
properties across Canada. The
Weston Foods operating segment includes a leading North American
bakery that offers packaged bread and rolls in Canada as well as frozen and artisan bread and
rolls, cakes, donuts, pies, biscuits and alternatives throughout
Canada and the United States.
About Hearthside
Headquartered in Downers Grove,
Illinois, Hearthside Food Solutions is a leading contract
manufacturer and producer of baked foods, snacks, nutrition bars,
frozen, refrigerated, and fresh sandwiches/entrees as well as a
full-service provider of food packaging services for many of the
world's premier brands. Prior to the Weston acquisition,
Hearthside's network included 37 food production facilities,
including four in Europe, with a
workforce of 12,000. For more information on Hearthside Food
Solutions, visit www.hearthsidefoods.com.
Forward Looking Statements
This press release may contain forward-looking information
within the meaning of applicable securities legislation, which
reflects the Company's current expectations regarding future
events. There can be no assurance regarding (a) the ability of the
Company to successfully complete the sale of the Weston Foods
fresh, frozen and ambient businesses as described in this press
release, (b) the proceeds to be derived from the transactions
referenced in this press release, and (c) the timing of closing of
any such sale.
Forward-looking information is based on a number of assumptions
and is subject to a number of risks and uncertainties, many of
which are beyond the Company's control, that could cause actual
results and events to differ materially from those that are
disclosed in or implied by such forward-looking information. Such
risks and uncertainties include, but are not limited to, the
factors discussed in the Company's current Annual MD&A and
Annual Information Form and uncertainty relating to the ongoing
COVID-19 pandemic. The Company does not undertake any obligation to
update such forward-looking information, future events or
otherwise, except as expressly required by applicable law. All
forward-looking statements contained in this press release are made
as of the date hereof and are qualified by these cautionary
statements.
Non- GAAP Financial Measures
The Company uses non-GAAP financial measures as it believes
these measures provide useful information to both management and
investors with regard to accurately assessing its financial
performance and financial condition. Management uses non-GAAP
financial measures to exclude the impact of certain expenses and
income that must be recognized under GAAP when analyzing underlying
consolidated and segment operating performance, as the excluded
items are not necessarily reflective of the underlying operating
performance and make comparisons of underlying financial
performance between periods difficult. The Company excludes
additional items if it believes doing so would result in a more
effective analysis of underlying operating performance. The
exclusion of certain items does not imply that they are
non-recurring. These measures do not have a standardized meaning
prescribed by GAAP and therefore they may not be comparable to
similarly titled measures presented by other publicly traded
companies, and should not be construed as an alternative to other
financial measures determined in accordance with GAAP. For
reconciliation to, and a description of, the Company's non-GAAP
financial measures and financial metrics, see Section 8 "Non-GAAP
Financial Measures" of the Management Discussion and Analysis in
the Company's 2021 Second Quarter Report.
SOURCE George Weston Limited