Agropur heightens presence in competitive US cheese market
border with its acquisition of Trega Foods to enable company
growth, impossible in Canada where competition is stifled.
The Canadian dairy market is dominated by three major companies, with over 75 percent being owned by Agropur, Saputo and Parmalat. The US dairy market conversely provides opportunities for consolidation. "Because of the regulatory situation in Canada, dairy companies are not able to export their products," spokesperson Jean Brodeur told FoodNavigator-USA.com. The US provides the best opportunity for expansion, being our neighbor and having similar customers. We want to use Trega Foods as our springboard into expansion." This will be Agropur's second acquisition in the US since 2002. "This business transaction is in direct link with our development strategy," said Pierre Claprood, CEO of Agropur. Located in Wisconsin, a state renowned for its dairy production, the Trega Foods manufactures different types of cheese and whey products. In its three facilities, 300 employees process 650m liters of milk annually (1.3 billion pounds), with sales of $300m. This will substantially increase Agropur's production, which process close to 2bn liters of milk per year (4.5bn pounds). It has annual sales of $2.45bn Its whey products include whey protein isolate powder and concentrate, whey phospholipids, foods lactose, reduced lactose whey and deproteinized whey for dairy applications. Trega Foods operations will continue with the same name and under the management of its current president, Doug Simon. He said: "We are now part of an organization that shares the same values as Trega Foods and we believe that we will be able to do exciting things in the future, thanks to our new association with Agropur." Agropur is the second Canadian dairy company to announce an acquisition in the US this week, following Saputo's statement that it intends to acquire the activities of Alto Dairy Cooperative, also based in Wisconsin. A spokesperson had told FoodNavgiator-USA.com that it saw the US cheese market as more competitive and fragmented, with ample opportunity for consolidation. Therefore, like Agropur, it wanted to increase its presence in the US.
