Billion-Dollar Davisco Sold To Canadian Dairy Co-Op
Le Sueur-based dairy processing company Davisco Foods International, one of the 25 largest private companies in the state, is being acquired by Canada’s largest dairy cooperative for an undisclosed sum.
Quebec-based Agropur announced Tuesday that it expects the deal to close August 1.
Davisco was founded in 1943 and is owned by the Davis family, which Forbes recently named the 130th richest family in the country—with a net worth of $1.7 billion spread across an estimated seven family members. The Davis family also owns the Minnesota-based kitchen countertop producer Cambria and Sun Country Airlines—neither of which were part of the deal with Agropur.
Davisco processes 3.8 billion pounds of milk a year and has 900 total employees. In its latest fiscal year the company generated $1.2 billion in revenue, according to research conducted by Twin Cities Business.
Agropur spokesman Marc Labelle said Davisco’s employees will “stay put” after the deal closes and that the company has no plans to relocate Davisco’s existing facilities or work force. He added that Davisco will be a standalone business unit for several months following the deal until it’s integrated into Agropur and takes on its buyer’s brand name.
Davisco CEO Jon Davis said in a statement that he, along with all of the company’s management team, will also be joining “the Agropur family.”
In Minnesota, the acquisition will include a cheese processing factory and a cheese shop in Le Sueur, an ingredients plant in Nicollet, and a sales office in Eden Prairie. Davisco will also sell a cheese processing facility in Idaho and South Dakota; sales offices in Shanghai, Singapore, and Geneva; and distribution centers in Rotterdam, the Netherlands, and Tianjin, China.
Agropur said the deal will double its U.S. dairy processing operations. President Serge Riendeau said this will be the company’s largest acquisition in its 76-year history.
“This transaction, combined with the most recent ones in Canada, will increase our sales to over $5.4 billion on an annualized basis, and we should reach 12.1 billion pounds of milk processed each year in 41 plants across North America,” Riendeau said in a statement. “As a result of this acquisition, the U.S. operations of Agropur should reach the top five cheese and ingredients processors in the United States to even better serve its clients.”
Agropur employs 6,500 people and processes milk in 32 plants across the country and in Canada. Agropur CEO Robert Coallier said the global dairy industry is consolidating quickly and that this acquisition will allow the company to increase its international presence.