Mississauga,ON /PRNewswire/ - Maple Leaf Foods ("Maple Leaf Foods" or the "Company") (TSX:MFI) announced today that its wholly-owned subsidiary, Greenleaf Foods, SPC, a leader in plant protein products, is advancing plans to increase tempeh production capacity through the acquisition and planned build-out of a food processing plant in Indianapolis, Indiana (the "Project").
Driven by growing demand for its Lightlife® tempeh products, phase 1 of the Project involves the acquisition of a 118,000 square foot plant in Indianapolis which is expected to close in early April, and the installation of tempeh production equipment with initial capacity of approximately 4.5 million kilograms. The acquisition is subject to typical closing conditions, including completion of due diligence.
Based on early pre-engineering for the build-out of the plant, the estimated cost of the Project, including the acquisition cost, is approximately US$100 million. Initial production at the plant is targeted to begin in the first half of 2022, and when fully operational it will employ approximately 115 people. If demand for tempeh continues as expected, the plant offers the flexibility for the Company to proceed with a second phase of the Project which could include doubling the capacity.
Building additional capacity for tempeh products aligns with the Company's goal of maintaining its market leadership position in this category and is consistent with its strategy to build capacity in support of the high-growth plant protein business through the effective deployment of capital.
"Maple Leaf Foods has been purposeful in executing a multi-tiered strategy focused on capital efficiency. To date, we have found ways to leverage the capacity of our existing plant protein manufacturing assets, while successfully utilizing footprint in the rest of our network," said Michael McCain, President and CEO. "At this juncture, given the high demand for our tempeh products, this Project offers us the ability to deliver incremental capacity in a cost-effective, timely manner in a location that has synergies with our long-term vision."
In 2019, Maple Leaf Foods announced plans to build a new world-class plant protein facility in nearby Shelbyville, Indiana, but development of that project has been delayed due to a number of factors including challenges created by the COVID-19 pandemic. By leveraging the opportunity to acquire an existing facility in Indianapolis to fast-track tempeh production, the Company will be able to meet near term, growing demand for tempeh while allowing more time to develop its longer-term vision for Shelbyville.
About Maple Leaf Foods
Maple Leaf Foods is a producer of food products under leading brands including Maple Leaf®, Maple Leaf Prime®, Maple Leaf Natural Selections®, Schneider's®, Schneiders®, Country Naturals®, Mina®, Greenfield Natural Meat Co.®, Lightlife®, Field Roast Grain Meat Co.™ and Swift®. Maple Leaf employs approximately 13,000 people and does business in Canada, the U.S. and Asia. The Company is headquartered in Mississauga, Ontario and its shares trade on the Toronto Stock Exchange (MFI).
Forward- looking statement
This news release contains forward-looking statements based on Maple Leaf Foods' current expectations and assumptions relating to its business, the environment in which it operates and its future operations, including the proposed acquisition of the plant and its ability to execute the Project. As these forward-looking statements depend upon future events, actual outcomes may differ materially depending on factors such as: satisfactory completion of due diligence; satisfaction of all closing conditions associated with the acquisition; ability secure incentives for the Project; the accuracy of the construction schedule and cost estimates; timely receipt of required permits and approvals for construction; current and demand for plant protein products, including tempeh; the ability of Maple Leaf Foods to execute its strategic initiatives in connection with the Project; availability and cost of engineering resources, construction crews and materials; weather conditions; activities of competitors, customers, and consumers; overall economic conditions; access to capital and financing alternatives; operational risks associated; the legislative, regulatory and tax environment; and other known or unknown factors. There can be no assurance that the results or developments anticipated by Maple Leaf Foods will be realized or that it will have the expected consequences for or effects.
All forward-looking statements contained in this news release are expressly qualified by this cautionary statement. Readers are cautioned that they should not unduly rely on these forward-looking statements and that the information contained in the forward-looking statements may not be appropriate for other purposes. Further, readers are cautioned that the forward-looking statements in this news release speak only as of the date hereof. Maple Leaf Foods does not undertake any obligation to update forward-looking statements except as required by securities law.
For additional information on these and other factors, see Maple Leaf Foods's public filings on www.sedar.com, including its Annual Management Discussion and Analysis for the year ended December 31, 2019 and its most recent Annual Information Form.