LB Maple Treat acquires Quebec's Decacer

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LB Maple Treat acquires Quebec's Decacer

Mon, 11/20/2017 - 12:54pm -- tim

Vermont Business Magazine The Canadian owner of Vermont's Highland Sugarworks in Websterville continues to acquire competitors in the raucous maple syrup industry. LB Maple Treat Corporation of Granby, QC, has acquired Decacer, a major bottler and distributor of branded and private label maple syrup and maple sugar based in Degelis, QC, for CD$40 million, subject to post-closing adjustments, from the Levasseur Family. LBMT's parent corporation, Rogers Sugar Inc (TSX: RSI) drew on its existing $275 million revolving credit facility to finance the Transaction.

Rogers itself bought LBMT last July for CD $160.3 million. LBMT had bought Highland in September 2016 for an undisclosed amount.

"This transaction is another important step in our strategic growth initiatives to reinforce our leadership position in the growing maple syrup industry. Decacer will broaden our maple syrup operations and expand our product offering, including a unique maple sugar dehydration technology, which provides us with an excellent line extension to our current sugar portfolio for consumer and food processor customers. On a pro-forma basis, we estimate that more than 20% of the Corporation's total sales will be derived from maple syrup, of which more than 70% of those sales will be exported worldwide. This acquisition, combined with the acquisition of LBMT in August 2017, will allow us to create a solid platform as well as various sales and operational synergies and provide opportunities for organic growth going forward. At the same time, the acquisition of Decacer will re-prioritize some of those synergies," said John Holliday, President and Chief Executive Officer.

"Decacer represents a solid complementary fit to Lantic Inc. ("Lantic") and LBMT. Once combined, we see opportunities to leverage sales and marketing efforts and fully take advantage of favourable growth trends in the maple syrup industry," said Eliott Levasseur, Vice President of Decacer.

Highland Sugarworks parent acquired for $126 million

DECACER ATTRIBUTES AND TRANSACTION

Headquartered in Levis, Quebec, Decacer has a state-of-the-art bottling plant in Degelis, in the heart of the Bas-Saint-Laurent region, one of Quebec's largest maple syrup producing regions. For the 12-month period ended March 31, 2017, Decacer's products were sold in Canada (approx. 47%), Internationally (approx. 40%) and in the U.S. (approx. 13%). For the same period, private label and branded products accounted for approximately 75% and 25% of total sales, respectively.

The $40 million purchase price represents an implied acquisition multiple of approximately 7.8x Adjusted EBITDA(1) of $5.1 million. Rogers Sugar expects to realize operational synergies over the next 12 to 18 months.

(1 ) Decacer's Adjusted EBITDA is defined as earnings before interest       
     expenses, taxes, depreciation and amortization for the twelve-month    
     period ended March 31, 2017, adjusted to take into account non-        
     recurring items identified by the Decacer Management, non-recurring    
     items identified by Rogers Sugar during the course of its due diligence
     and estimated adjustments required to reflect the going-forward EBITDA 
     run-rate.                                                              

About Rogers Sugar Inc.

Rogers Sugar is a corporation established under the laws of Canada. The Corporation holds all of the common shares of Lantic and its administrative office is in Montreal, Quebec. Lantic operates cane sugar refineries in Montreal, Quebec and Vancouver, British Columbia, as well as the only Canadian sugar beet processing facility in Taber, Alberta. Lantic's sugar products are marketed under the "Lantic" trademark in Eastern Canada, and the "Rogers" trademark in Western Canada and include granulated, icing, cube, yellow and brown sugars, liquid sugars and specialty syrups. Lantic owns all of the common shares of LBMT and its head office is headquartered in Granby, Quebec. LBMT operates bottling plants in Granby and in St-Honore-de-Shenley, Quebec and in Websterville, Vermont. LBMT's products include maple syrup and derived maple syrup products and are sold under various brand names, such as L.B. Maple Treat, Great Northern, Sucro-Bec and Highland Sugarworks.

About Decacer

Founded in 2000, Decacer brings innovation to the maple syrup industry with its premium quality pure maple products. Its state-of-the-art maple syrup bottling facility and maple sugar production unit manufacture products in various formats under the Decacer brand name and private labels for the retail and food processing markets. Decacer operates one bottling plant in Degelis, Quebec. Decacer operates under a HACCP plan and maintains high quality standards as well as BRC, Kosher, CFIA, and Ecocert certifications. Decacer offers high production capacity and full traceability.

Source: MONTREAL, QUEBEC and VANCOUVER, BRITISH COLUMBIA--(Marketwired - November 20, 2017)