LONDON, ONTARIO and MANKATO, MINNESOTA--(Marketwire - Oct. 18, 2012) - Masterfeeds Inc. and Ridley Inc. (TSX:RCL) announced today an agreement that will merge their respective commercial livestock and poultry feed and nutrition businesses in Canada into a new entity called Masterfeeds LP.
The combination of Masterfeeds and Ridley's Canadian feed business, which operates as Feed-Rite, will create the second largest feed provider in Canada. The new entity will operate, among other things, 22 feed manufacturing plants and employ over 500 people in a business spanning across Quebec, Ontario and the Prairie Provinces. Masterfeeds LP will be headquartered in London, Ontario and led by current Masterfeeds Inc. Chief Executive Officer, Rob Flack.
"Masterfeeds and Feed-Rite are two of the most respected brand names in Canadian animal agriculture," said Flack. "We are excited about bringing the strengths of both companies together as we continue to serve our dealers and customers with dynamic feeding solutions and a larger, more efficient geographic footprint in Canada. As Canadian meat, milk and egg producers have become fewer, larger and ever more sophisticated, it has been obvious for some time that the feed industry in Canada would benefit from a similar transformation. As the feed industry evolves, we expect there to be more opportunities for Masterfeeds LP to grow in the future," added Flack.
"The Feed-Rite name will celebrate its 75th anniversary in Canada next year," stated Ridley CEO Steve VanRoekel. "Ridley's commitment to the long-term in Canada has been unwavering since we acquired the business nearly 20 years ago. We've never hesitated to make the changes necessary to maintain a competitive advantage, and this merger puts all stakeholders in the Feed-Rite organization in a position for even more opportunity going forward."
Each of Masterfeeds Inc. and Ridley Inc. will contribute essentially all of their Canadian feed operating assets in exchange for relative shareholdings in Masterfeeds LP. That transfer is expected to result in no material impact overall to Ridley's balance sheet, nor is it expected to have any material effect on the structure or other operations of Ridley Inc. Both parties expect the merger to result in significant new synergies over time. Completion of the merger is expected to take 30-45 days and is subject to the execution of definitive agreements and normal conditions including regulatory approvals.
About Masterfeeds Inc.: Masterfeeds (www.masterfeeds.com) has an 83-year history of research, innovation and service to animal agriculture in Canada. Headquartered in London, Ontario, Masterfeeds is a wholly-owned subsidiary of Ag Processing Inc. (AGP). AGP (www.agp.com), headquartered in Omaha, Nebraska, is a farmer-owned cooperative engaged in the procurement, processing, marketing and transportation of grains and grain products. AGP, which acquired Masterfeeds in 1991, is owned by 175 local cooperatives representing over 250,000 farmers throughout the Midwest, and five regional cooperatives representing farmers throughout the U.S. and Canada.
About Ridley: Ridley Inc. (www.ridleyinc.com), headquartered in Mankato, Minnesota and Winnipeg, Manitoba, is one of North America's leading commercial animal nutrition companies. Ridley manufactures and distributes a full range of animal nutrition products under a number of highly regarded trade names.
Ridley's Canadian feed business, operating under the trade name Feed-Rite (www.feedrite.com), is reported in Ridley's financial statements as the Canadian Feed Operations segment.
This report contains "forward-looking" information. The forward-looking information includes statements concerning the proposed transaction described herein, Ridley's outlook for the future, as well as other statements of beliefs, plans and strategies or anticipated events, and similar expressions concerning matters that are not historical facts. Forward-looking information and statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, contemplated or implied by, such statements. These risks and uncertainties include the risk that the proposed transaction described herein will not be completed, the ability to make effective acquisitions and successfully integrate newly acquired businesses into existing operations, the availability and prices of raw materials and supplies, livestock disease, product pricing, the competitive environment and related market conditions, operating efficiencies, access to capital, the cost of compliance with environmental and health standards and other regulatory requirements affecting Ridley's business, adverse results from ongoing litigation, and actions of domestic and foreign governments. Other risks are outlined in the Risk Management section of the MD&A included in Ridley's Annual Report. Unless otherwise required by applicable securities law, Ridley disclaims any intention or obligation to publicly update or revise this information, whether as a result of new information, future events or otherwise. Ridley cautions readers not to place undue reliance upon forward-looking statements.