Agropur to expand ice cream market presence with Scotsburn acquisition

02-Feb-2017 - Last updated on 03-Feb-2017 at 09:37 GMT

Agropur's acquisition of Scotsburn ice cream production facilities is expected to be completed this March. ©iStock/279photo

Related tags Ice cream Milk Dairy

Canadian dairy cooperative Agropur has acquired assets of Scotsburn Cooperative Services, expanding its presence in the ice cream and novelties market.

The acquisition plan includes taking over Scotsburn production plants in Truro, Nova Scotia, and Lachute, Quebec, which together manufacture more than 13m gallons (50m liters) of frozen dairy products per year and have total annual sales of C$150m (US$115m).

"I am very happy that this transaction, which will help combine dairy processing assets in the hands of milk producers, has closed," Serge Riendeau, president of Agropur, said.

Agropur’s focus on ice cream

Agropur is the processor for major dairy brands such as Iogo, Natrel, and Oka, but the cooperative had a very limited presence in the ice cream market.

"This transaction will strengthen our presence in the ice cream market and enable us to better serve our retail partners on a national basis," Robert Coallier, CEO of Agropur, said.

“With this acquisition we will more than triple ice cream sales,” Agropur vice president of communication, Veronique Boileau, told DairyReporter.

“Now of course we have a lot of work to do so we have to make a complete review of our activities. So this will take some time.”

Jobs to ‘remain the same’ for now

Scotsburn has been undergoing a series of downsizing initiatives, which started in 2014 when it sold the fluid milk part of its business to Saputo Inc. for C$61m (US$46.8m).

In September 2016, Scotsburn shut down its Brookfield Ice Cream Limited plant in St. John’s, Newfoundland, resulting in the layoff of 167 employees, which Unifor Atlantic Regional Director described as “heart-breaking news” for union members and their families at the time of the plant closing.

When asked whether or not the acquisition will impact jobs at each of the Scotsburn plants, Boileau said, “For now, it just remains the same.”

Agropur acquiring Scotsburn assets means Agropur will continue to produce Scotsburn-branded products.

“I am very pleased with this transaction,” Scotsburn chairman of the board, Robbie MacGregor said.

“It is the best solution to ensure the future of local dairy production and processing.”