Olymel L.P. is buying Pinnacle Farms Inc., a major hog producer located at Standard, Alta., near Strathmore.
Olymel becomes the owner of all inventory and will now take over management of Pinnacle Farms operations, a company news release said.
Pinnacle employs 30 persons who will now join the Olymel workforce. The transaction amount was not disclosed.
The assets acquired by Olymel include a quarantine barn, sow barns, nursery barns and finishing barns. In addition to these Pinnacle facilities, Olymel will lease finishing farms near Medicine Hat, Alta.
The acquisition will bring the number of sows available to Olymel in the West to 52,000. The transaction will also make it possible to deliver 100,000 more hogs annually to the Olymel processing plant in Red Deer, whereas these pigs were previously sold as iso-weans and feeders to other buyers in Alberta and the United States.
To feed the piglets to market weight hogs, Olymel will need 30,000 contract finishing spaces through new or existing capacity in Alberta.
“I would like to thank Ron Arnason, president of Pinnacle Farms, and Verus Management, Pinnacle’s partner with which we have had business relationships for many years and which established the climate of trust that led to this transaction, said Olymel president and chief executive Réjean Nadeau in the release.
Olymel has set a target for 2020 to produce more than 1.5 million hogs annually in Western Canada in order to meet the growing demand from its customers.
The Olymel pork processing plant in Red Deer has more than 1,540 employees.
“Pinnacle has been supplying finishing hogs to Olymel for more than four years, so our two companies have had time to get to know one another,” said Ron Arnason, director of Pinnacle Farms Inc., in a release.
“Verus Management and I are pleased with the conclusion of this relationship and the transaction we are announcing today. We are confident that Pinnacle Farms employees will find a dynamic environment at Olymel where they can maximize their work. This transaction opens the door to the company’s further development, and will enable it to serve new markets.”