Grain handling company Parrish & Heimbecker Limited today announced that it is significantly expanding its network of grain elevators and crop input retail centres in Western Canada.
The Winnipeg-based company has reached a deal with Louis Dreyfus Commodities to acquire 10 Canadian-based facilities in Manitoba, Saskatchewan, Alberta and British Columbia.
According to a Sept. 4 news release, P&H will acquire Louis Dreyfus operations in Virden, Man., Dawson Creek, B.C, Tisdale, Aberdeen, Wilkie and Kegworth in Saskatchewan and Joffre, Lyalta and Rycroft in Alberta.
Louis Dreyfus will retain its grain terminal in Port Cartier, Que., and a canola crushing plant and refinery in Yorkton, Sask.
Financial terms of the deal were not disclosed.
The transaction is expected to close in the fourth quarter of 2019, subject to the satisfaction of regulatory requirements and customary closing conditions.
In a news release, P&H said the deal with Louis Dreyfus will provide farmer customers with increased access to more competitive offerings in grain trading, handling and merchandising, as well as full-range crop input products and agronomy services.
The expansion continues P&H’s effort to build a more competitive grain supply chain across Canada, consisting of grain terminals, flour milling facilities, feed mills and elevators.
“This is an incredibly exciting day as P&H continues its investment in assets and terminals to provide farmers with local, best-in-class products and support, backed by a growing national grain asset network,” said John Heimbecker, chief executive officer at P&H.
“Acquiring geographically strategic assets from a global leader like LDC makes us better and stronger by an order of magnitude.”
Brant Randles, president of Louis Dreyfus Commodities Canada, said his company remains committed to serving the Canadian market.
“We have been active in Canada for over 80 years and remain committed to this important market, connecting Canadian growers with local and international food markets with a greater focus on value-added processing,” he said.
The company’s grains and oilseeds terminal in Port Cartier, Que., remains an important asset in connecting North American farmers to the world market, it said.
The canola crushing and refining plant in Yorkton processes more than one million tonnes of canola annually into meal and edible oil.
Louis Dreyfus has invested more than $65 million into its Yorkton crush plant over the past few years.
P&H is a family owned company with deep roots in the Canadian grain industry.
It was incorporated in 1909 and has offices across the country.
The company’s grain business includes trading, handling, marine and rail freight management to domestic and export markets.
Divisions of P&H include New Life-Feeds and P&H Milling, the largest Canadian owned flour milling business in the country.
The company employs 1,500 people and has customers in 15 countries.
Based on total storage capacity at primary elevators, Louis Dreyfus was the sixth largest commercial grain handler in Canada with total storage capacity of more than 377,000 tonnes.
P&H was the fifth largest with total storage of 636,000 tonnes at 20 locations.
If the acquisition goes ahead, P&H’s total storage capacity would exceed one million tonnes at 30 locations, making it the country’s third largest grain handler behind Viterra and Richardson.
Less than a decade ago, total capacity at P&H’s primary elevator network was just a hair of 350,000 tonnes.
In its news release, P&H did not say whether the acquisition would result in any facility closures or layoffs.
P&H already owns a 52,000 tonne elevator at Tisdale, Sask. The acquisition of Louis Dreyfus’s 41,000 tonne facility at Tisdale would give the company two facilities at the northeastern Saskatchewan community, one served by each of Canada’s two major railway companies.