Canada Bread agrees to sell pasta business to Spain's Ebro

Reuters

TORONTO, Oct 24 (Reuters) - Canada Bread Co, whichis majority-owned by Maple Leaf Foods, said on Thursdayit agreed to sell its Olivieri Foods fresh pasta and saucebusiness to Spanish food processing company Ebro Foods SA for about C$120 million ($115.5 million).

The move comes days after Canadian food processor Maple Leafsaid it might sell its controlling stake in Canada Bread as itdecides whether to exit the bakery goods business and focus onmeat products.

Toronto-based Canada Bread said the deal, which is subjectto regulatory approval, is expected to close by the end of 2013.

Olivieri Foods accounted for less than 10 percent of CanadaBread's revenue in 2012. The company also sells bread under theDempsters brand and other food products under banners such asPOM, Ben's and Sunmaid.

The Olivieri business, which employs some 375 people, makesflat and filled fresh pasta products and sauces at facilities inHamilton, Ontario and Delta, British Columbia.

Canada Bread, which has a market capitalization of roughly C$1.78 billion, employs some 6,400 people in operations acrossCanada, the United States and Britain.

It is one of two dominant Canadian bakers, along with foodproducer George Weston Ltd, parent of the Loblaw Cos Ltd grocery chain.

Shares in Canada Bread rose 43 Canadian cents to C$69.00 inearly trading on the Toronto Stock Exchange following the newson Thursday, while Maple Leaf shares rose 1.6 percent toC$15.57.

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