On the heels of Saputo Inc.’s most recent $450 million acquisition of Australian dairy Warrnambool, the company is now reportedly in the market for further acquisitions.
In a recent interview with Canadian Business, CEO Lino Saputo Jr. announced the company is not planning to stop searching for potential targets anytime soon. Over the course of the current fiscal year, Saputo could add up to three more companies to its ever-expanding portfolio, he told the publication, noting North America, Latin America, and Oceania as potential regions he’s been eyeing.
“We’ll be happy with the 1 percent to 2 percent growth in the developed North American markets and maintain our presence there,” says Saputo, “but we’re tapping into emerging markets that are showing more growth potential than the developed markets.”
In particular, Saputo mentioned Brazil as a market the company is interested in. The country ranks fifth in dairy production in the world and was the largest milk producer in Latin America in 2008, with a market share of 46%, according to a report by the Wisconsin International Trade Team.
“The largest dairy [in Brazil] might be $1 or $2 billion in sales. They might represent less than 10% of the entire industry and the rest of the players are all small to medium in size, ranging from $20 million in sales to $100 or $200 million,” Saputo says. “We see great potential to be a consolidator in Brazil.”
Saputo Inc. will also continue to grow its business in Australia and New Zealand, he told Canadian Business, although establishing a base there could be more difficult since the market is more heavily concentrated.
Saputo concluded by saying that while the international markets may remain a little challenging for the balance of this calendar year, the company’s foundations are solid.
