Australian bulk grain-handling firm GrainCorp plans to buy Canada Malting and its three sister companies in United Malt Holdings (UMH) for just under C$700 million.
The Sydney-based grain handler said last week it would fund what it calls a “company-transforming acquisition” through a debt facility and a “fully underwritten” equity raising.
The seller, New Yorkbased private equity firm Castle Harlan and its Australian arm, CHAMP Private Equity, has owned Canada Malting, U.S. firm Great Western Malting, Australia’s Barrett Burston Malting (BBM) and a 60 per cent stake in U.K. firm Bairds Malt since September 2006.
That’s when Castle Harlan, whose other Canadian and U.S. holdings include the Perkins restaurant chain, bought the four maltsters from U.S. agrifood giant ConAgra and South Africa’s Tiger Brands. It bought up the remaining 40 per cent of Bairds Malt in 2007.
Calgary-based Canada Malting’s holdings include malthouses at Calgary, Montreal and Thunder Bay, transloading and container packing operations at Vancouver, Toronto and London, Ont., and warehouses at Vancouver, Toronto, Montreal and Innisfail. The company supplies brewers across the country.
Canada Malting, whose history dates back to 1902, had been widely held for much of its existence. By the time ConAgra bought control of it in 1995, Canada Malting’s major shareholders had included both the Molson and Labatt brewing firms.
Canada Malting’s sister firm, Great Western Malting, supplies brewers throughout the western U.S. from malt houses at Pocatello, Idaho and Vancouver, Washington.
GrainCorp said it expects to finalize the deal in late November, pending “relevant regulatory approvals” as well as a successful equity underwriting agreement and “no material adverse effect on UMH’s business” between now and then.