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Maple Leaf Restructures

Maple Leaf Foods sells turkey farms and hatchery operations to focus on processing and marketing


September 13, 2013
By Treena Hein

Topics
Ernald currently produces 2.3 million pounds of chicken and 8.8 million pounds of turkey each year.

In early August, Maple Leaf Foods announced it was selling its commercial turkey farms, breeder farms and hatcheries to two different companies. Representatives say that most of the 100 employees involved are moving with the sale.   

“Maple Leaf made this strategic move so that we would be able to focus on growth and innovation within our value-added turkey processing business,” says Maple Leaf spokesperson Dave Bauer. “We have seen a lot of growth in the value-added turkey product market, we’re committed to capitalize on it, and we have exciting plans to launch even more innovative options that our consumers can enjoy.”    

Maple Leaf’s commercial turkey farms were sold to Kitchener-based Ernald Enterprises Ltd., which will make it Maple Leaf’s biggest turkey supplier. Ernald president James Schlegel notes that although the deal seems to have developed quickly over the last few months, it’s based on a relationship between Ernald and Maple Leaf that goes back about 50 years.

“This long history and solid partnership formed the foundational basis for the transaction,” he says. “Everything was able to move forward relatively swiftly because we know each other and trust each other.”

The turkey farms involved in the deal originally belonged to Cold Springs Farms, which were sold to Schneider. Then Maple Leaf acquired Schneider, along with the barns located, says Schlegel, in the Woodstock and Thamesford area.

Ernald holds more than 1,200 acres of cropland in the vicinity of Ailsa Craig, Nairn, Komoka and New Dundee. Before the transaction, it already operated five turkey and chicken farms near those communities, with about 470,000 chickens and 340,000 turkeys (production of 2.3 million pounds of chicken and 8.8 million pounds of turkey each year).

“This move organizes the supply chain in a more effective way so that Ernald will handle primary production, and Maple Leaf will focus on their considerable experience and expertise in processing and marketing,” Schlegel explains. “In terms of genetics, we have mostly used birds from [one particular company] and it’s been favoured. We will likely continue to favour those birds, but will also use some [competitior genetics].”    

Maple Leaf sold its breeder farms and hatchery operation to Cuddy Farms Ltd., which is based in Strathroy, Ont. The acquired operations are located near Thamesford, Mossley, Aylmer, Putnam, Ingersoll and Woodstock. Cuddy Farms is the leading supplier of turkey poults and hatching eggs in the world. The company exports its products to more than 20 countries around the globe, including Germany, Mexico, Italy, Turkey, Poland, Austria, Holland, Hungary and the Baltic States.

“This acquisition demonstrates our commitment to the worldwide turkey industry,” says Cuddy Farms vice-president of sales and marketing, Scott Chambers. “We are encouraged that our long-standing employee groups in both the Thamesford, Ont., and Strathroy, Ont., operations will enable us to further develop the best genetics that the primary breeders have to offer.”

Chambers says the Cuddy Farms management team is dedicated to long-term business success, and will continue to grow the business throughout its worldwide customer and distribution base.

“We are grateful to be able to offer continued employment to all our current employees as well as those associated with the acquisition,” he notes. “As a result of the acquisition, we have increased the scale of our operation significantly, which puts us in a better position to supply high quality turkey eggs and poults in a timely manner to our customers, both in Canada and around the world.”