MONTREAL (FNS) -- Local mozzarella cheese manufacturer Saputo Group here has swallowed Stella Foods of Lincolnshire, Ill., the second-largest mozzarella cheese maker in the United States, in a deal worth $563 million Canadian (U.S. $405.3 million).
ut 15% of Saputo's annual sales of $461 million (U.S. $331.9 million) came from the United States, from its plants in Maryland and Vermont.
Saputo's was the best of five bids for Stella Foods, according to an official from Specialty Foods, which lost $487 million (U.S. $350.6 million) last year and put Stella Foods up for sale in May.
The proceeds from the sale will go toward reducing debt and toward expanding Specialty Foods' bakery and specialty meats operations, the official added. Stella has 1,800 employees at 12 plants, which produce 192 million kilograms (422 million pounds) of cheese annually. Last year it reported earnings before interest, tax, depreciation and amortization of U.S. $45 million on sales of U.S. $725 million.
Saputo reported 1996 earnings before interest, tax, depreciation and amortization of $73 million ($52.5 million) from eight plants employing 950 workers, which produced 55 million kilograms (121 million pounds) of cheese.
Lino Saputo, company president and chief executive officer, said he plans to acquire other American competitors that fall victim to the consolidation taking place in the North American dairy industry. He said there are fewer opportunities to acquire similar businesses in Canada.