Mexico's Bimbo Group Buys Canada's Weston U.S. Bakery Unit for $2.38 Billion

Grupo Bimbo now employs 97,000 people in 18 countries.

MEXICO CITY -- Mexican baking giant Grupo Bimbo SAB announced Wednesday that it is buying the U.S. bakery unit of Canada-based George Weston Ltd. for $2.38 billion.

The transaction will be the biggest in the company's history, Bimbo said in a statement.

Weston Foods Inc., the U.S. subsidiary of Canada's largest supermarket operator, produces the Boboli, Brownberry, Entenmann's, Freihofer's, Stroehmann and Thomas' brands of breads, rolls, muffins and bagels.

Weston had gross sales of nearly $2.2 billion during the 12 months that ended Oct. 4 and has maintained some of the highest profit margins in the industry, Bimbo said.

Latin America's biggest breakmaker already operates in the United States through its Bimbo Bakeries USA subsidiary, which is to absorb Weston Foods.

The expanded BBUSA will have 35 plants and more than 15,000 employees and is to be headed by Weston's current chief, Gary Prince.

The deal is to be financed through a long-term $1.7 billion credit line and a one-year bridge loan of $600 million, Grupo Bimbo said.

Bimbo's finance director, Guillermo Quiroz, thanked Bank of America, Citigroup subsidiary Banamex, BBVA Bancomer, HSBC, ING and Santander for their willingness to back the company "even in these moments of financial turbulence."

Bimbo and Weston expect the transaction, which is subject to regulatory approval, to be concluded in the first quarter of 2009.

Grupo Bimbo is one of the world's leading breadmakers, employing more than 97,000 people at plants and distribution centers in 18 countries.

Mexico's Bimbo Group Buys Canada's Weston U.S. Bakery Unit. Retrived from Latin American Herald tribute web page: http://www.laht.com/article.asp?CategoryId=14091&ArticleId=322758