Maple Leaf Foods (MFI) is spinning off its pork business into a separate publicly traded company as it tries to turnaround its poor-performing stock.
In a news release, Toronto-based Maple Leaf said it is spinning off its pork division so that it can focus on its more profitable packaged goods business that includes ready-to-serve foods such as Ready Crisp bacon.
Under the plan, Maple Leaf stockholders will receive shares in the new company, while Maple Leaf will retain a 20% ownership stake in the still unnamed pork company.
Additionally, the new pork company will continue to provide Maple Leaf Foods with a secure supply of pork products at market prices.
The management team of the new publicly traded pork business will be led by Dennis Organ, who joined Maple Leaf Foods in February 2023 as president of the pork unit.
The plan has been approved by the company’s board of directors and has the support of the McCain family who are the majority shareholders of Maple Leaf Foods.
The spin-off is expected to be completed in 2025.
Maple Leaf Foods’ stock has been a long-term underperformer. The company’s share price has declined 24% over the last five years, including a 14% decrease in the past 12 months.
The company’s shares currently trade at $22.45, about the same price they were at a decade ago.
