A change of ownership is taking place at a major dairy processing plant in Eastern Ontario. Parmalat Group has reached a $1.62 billion agreement to acquire the natural cheese division of Kraft Heinz Canada, which has a facility in Ingleside, west of Cornwall.
Kraft Heinz Canada’s cheese brands include Cracker Barrel, P’tit Québec, and aMOOza! Parmalat already has 3,000 employees, 16 processing plants, and a research and development facility. Once the acquisition is approved, it will add the 400 Ingleside employees to Parmalat’s Canadian payroll.
Parmalat said the addition of the Kraft Heinz products could create a more efficient distribution and supply chain for dairy products and protect jobs and farm incomes.
Kraft Heinz was formed in 2015 when the two formerly separate US-based food giants, known for everything from ketchup to peanut butter, merged.
There are already Canadian Parmalat processing plants in Winchester, Belleville, and Victoriaville. The company said adding Ingleside to its operations means it will be better able to meet demand. The Winchester plant was originally part of the former Ault Foods, Belleville was Black Diamond, and Victoriaville was Lactantia.
Parmalat’s history in Canada goes back 130 years with the Balderson cheddar brand. Its other major Canadian dairy brands include Lactantia and Beatrice. The company itself began in 1961 in Parma, Italy. It faced financial ruin in 2003 with what is still Europe’s largest bankruptcy. In 2011, Parmalat became a subsidiary of France-based Lactalis, but it remains a publicly-traded company on the Milan-based Borsa Italiana stock exchange. Kraft-Heinz is traded on the New York-based NASDAQ exchange.
Kraft Heinz Canada will continue to own and market its Philadelphia Cream Cheese, Cheez Whiz, and Kraft Singles cheese products in Canada. Those items are made at a Kraft Heinz plant in Québec.
Bart Rijke, a dairy farmer from Hammond who represents Glengarry, Prescott and Russell on the Dairy Farmer’s of Ontario (DFO) board, said the organization does not have any position on mergers and acquisitions in the processing and distribution industry. However, he did say Parmalat’s acquisition of the Ingleside plant and the products it produces is a sign the company has confidence in the dairy system. Rijke added if Parmalat is able to grow the cheese market, it will benefit dairy farmers in the long run.
Parmalat and Kraft Heinz hope to have the transaction involving the Ingleside plant completed in 2019.