The acquisition is subject to regulatory approval, in both Canada and the US - Nutreco expects the deal to close in the second half of 2017 at the latest.
The Alberta headquartered Hi Pro Feeds comprises 15 individual feed mills with operations spanning three US states and three western Canadian provinces. It supplies complete and specialty feeds, premixes, concentrates and commodity ingredients to 5,000 producers, mainly in Western Canada and Southwestern US.
Stronger US foothold
Nutreco had a “fairly modest footprint” in the US prior to this move and the acquisition of Micronutrients last year.
The Dutch group will look to capitalize on the stronger foothold in Southwestern US it gains with this deal, particularly in the dairy and beef industry there.
“Hi-Pro Feeds enables Nutreco to become a truly Canada-wide animal nutrition company with a good presence in all regions and livestock segments.
“In the US, this acquisition creates a new base for Nutreco – in addition to [existing business in the US] Trouw Nutrition USA, the Shur-Gain operations in New York state and Micronutrients,” said Mark Woldberg, corporate spokesperson, Nutreco.
“Nutreco and Hi-Pro Feeds can complement each other,” he continued.
Hi-Pro Feeds is “best in class” in operational excellence, so in combining that aspect with Nutreco’s nutritional portfolio, global reach and “innovation strength” the net result will be “more value for our combined customer base," added Woldberg.
The current leadership team consisting of Daren Kennett, Mark Knief and Jeff Dykstra is to continue to manage the Hi-Pro Feeds business in both Canada and the US, with the current CEO, Dean Prevost, to transition his responsibilities over time.
Birch Hill Equity Partners is the current majority owner of the Canadian feed company, and over 80% of the employees are shareholders in the business.