The Saskatchewan government has bought into Florian Possberg’s Big Sky Farms Inc., backing the expansion of one of the province’s biggest hog producers.
Crown Investments Corporation is investing $15 million so that Big Sky can build two new hog barn networks in Rama and Ogema. The total cost of the new barns is $60 million.
Each barn will house 5,000 sows and produce 116,000 market hogs per year. Altogether Big Sky will produce 400,000 pigs per year.
Karen Schmidt of CIC said the government believes it is investing with a tried-and-true company.
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“We’re confident in Big Sky as a partner,” said Schmidt.
Possberg, who owns a number of barns in the Humboldt and eastern Saskatchewan area, said his company has wanted to expand but has had difficulty attracting enough investment capital.
The company tried a public offering two years ago but did not find enough interest.
“Major institutional investors in Toronto – we don’t even show up on their radar screens,” said Possberg.
Big Sky was created in 1995 and became one of Saskatchewan’s dominant producers. With the provincial investment the company will have assets worth more than $100 million.
Schmidt said the provincial government decided to directly invest because it wanted to promote growth in hog production.
“Sometimes government needs to get involved to show people that it is a good investment and to encourage people to further invest from the private sector,” she said.
The province will receive preferred shares for its investment, making it an equity partner rather than a lender. The money gives the province a stake in the company as a whole, rather than just the two new barn complexes.
