Canadian agribusiness giantViterra Inc., Calgary, Alberta, said it agreed to purchaseDakota Growers Pasta Company, Inc., Carrington, N.D., in an all-cash transaction valued at approximately $240 million. Both parties expect to complete the deal -- involving a purchase of Dakota Growers stock -- in the second quarter of 2010.
Officials say Dakota Growers operates one of North America's largest durum mills and is the third largest producer and marketer of dry pasta products, primarily supplying the ingredient, food service and private label retail markets. The company owns an integrated durum mill and pasta production plant in Carrington and a pasta production plant in New Hope, Minn. Dakota Growers reported revenues and EBITDA of approximately USD$275 million and USD$42 million respectively during a 12-month period ended October 31, 2009.
"We are very pleased to announce our agreement with Dakota Growers. The histories of our companies are built upon the strength of our solid relationships with our farmers and customers. Our offer comes with numerous benefits for both organizations and aligns well with Viterra's strategic vision to increase investment in food processing," said Mayo Schmidt, Viterra's president and CEO. "We believe that by building upon our deep knowledge of the North American durum market, we can create additional value and support the increasing demand for high quality pasta desired by today's health-minded consumer."
Added Tim Dodd, president and CEO of Dakota Growers, "Viterra has a reputation for quality and performance and we share similar cultures and values. This is an exciting opportunity for both companies, one that I believe will secure our long-term future and allow us to expand our product and service offerings to improve the value proposition for Dakota Growers customers."
"By joining our businesses it provides an excellent opportunity to deepen our relationships with North American farmers and premier food manufacturing companies and suppliers," said Karl Gerrand, Viterra's senior vice president, Processing. "The pasta segment in North America has enjoyed a strong period of growth over the past several years as consumers have returned to healthy, value-driven meal choices. Dakota Growers' product strength and market presence with major branded food manufacturers, retailers and institutional customers has enabled the company to participate in the resurgence of the pasta industry."