January 27, 2022

By Lynda Kiernan-Stone, Global AgInvesting Media

Claridge, a Montreal-based family office, is partnering with Investissement Québec and the Fonds de solidarité FTQ to launch a C$100 million (US$78.5 million) investment fund with the goal of transforming food processing companies in Québec with growth potential into North American leaders. 

The food and beverage sector is a major contributor to the economy of Québec. InvestQuebec states that there are 2,400 food processing businesses in the province representing a wide range of segments that include some of the most recognizable names in the global food industry. From bakery, to beverages, dairy, fruit and vegetables, meat, confectionery, and more, companies such as Cargill, Maple Leaf Foods, Barry Callebaut, Frito-Lay, Ronzoni Foods, Weston, and ConAgra Foods are working to meet demand along with many other smaller, entrepreneurial innovators that will need to develop a global vision through collaboration to accelerate their growth. 

Accounting for nearly 70,000 jobs, 70 percent of Québec’s agricultural production is processed, generating shipments valued at C$29.1 billion (US$22.8 billion), according to InvestQuebec. Of these shipments, dairy and meat account for the largest share at almost 42 percent of total shipments. 

The three partners have each played roles in supporting this dynamic food processing sector. Claridge has invested more than C$400 million (US$314 million) in a dozen food processing companies across Canada and the U.S. over the past 20 years. Investissement Québec cites its strong commitment to the agri-food sector, which is one of the State corporation’s priority sectors, committing C$35 million (US$27.5 million) of its own capital to the new investment vehicle. And Fonds de solidarité FTQ, which is dedicating C$22.5 million (US$17.6 million) to the new fund, considers the sector a priority industry.

“We are proud to have facilitated the creation of this innovative new financing tool to drive the growth of key players in the local food processing sector,” said Guy LeBlanc, president and CEO, Investissement Québec. “We recognize the strategic contribution of this industry to Quebec’s economic development and that of its regions, and its essential contribution to our food autonomy. We’re well aware of the challenges industry players are facing, and will continue to work alongside partners in the ecosystem to support them and contribute to their growth.”

This new fund, founded by partners with a common long-term vision centered on a patient, practical, growth-oriented approach, will take either minority or majority stakes in select companies, offering not only financial resources, but managerial and operational support, knowledge of global trends, and an extensive network of partners to drive growth for companies in Québec and across North America – resulting in greater value at all stages of their development.

The investment platform will be headed up by Ludovic Dumas, vice president of direct investments for Claridge, and food and beverage veteran and former country head for Nestlé SA, Bob Leonidas – two leaders who bring decades of experience investing in, and managing food processing companies in Québec, Canada, and abroad.

“There’s a lot of very interesting food businesses in Québec but some of them have challenges as they’re trying to expand beyond our borders,” Dumas told The Globe and Mail. “The idea is essentially to identify a few companies that we’ll invest in and build for the long term.”

Janie C. Beïque, president and CEO, Fonds de solidarité FTQ, commented, “…companies in this strategic industry for Québec’s economy will be able to count on the patient capital and support they need to ensure their growth in a rapidly changing market. As evidenced by the historic C$1.3 billion (US$1 billion) in investments made by our specialized agri-food team, the Fonds de solidarité FTQ considers this industry a priority sector.”

In 2020, Québec’s Ministry of Agriculture, Fisheries and Food announced an investment of C$5.5 million (US$4.32 million) in Inno-centre to fund the deployment of expert consultants to provide high-level business advisory services to innovative agri-food processors, with the goal of achieving growth through optimization of logistics, marketing, merchandising, human resources, and financial management. 

“This funding is excellent news for the bio-food sector and further proof of its importance for our government,” said André Lamontagne, Minister of Agriculture, Fisheries and Food at the time. “Through a $5.5 million investment in Inno-centre, our government is supporting food processing companies to provide them with the opportunity to benefit from high-quality consulting services and have the human resources they would not otherwise have access to. Competitiveness is the key to any business’s success and a stepping stone for Quebec toward food autonomy.”

Now, this new fund will be able to take the province’s agri-food processors to the next level, stating that they are willing to invest many times their initial commitment to support pivotal projects.

Pierre Boivin, president and CEO of Claridge, concluded, “Together, we want to invest in high-quality companies to become their active partners and support their growth strategies.”

– Lynda Kiernan-Stone is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Oilseed & Grain News. She can be reached at lkiernan-stone@globalaginvesting.com. 

*The content put forth by Global AgInvesting News and its parent company HighQuest Partners is intended to be used and must be used for informational purposes only. All information or other material herein is not to be construed as legal, tax, investment, financial, or other advice. Global AgInvesting and HighQuest Partners are not a fiduciary in any manner, and the reader assumes the sole responsibility of evaluating the merits and risks associated with the use of any information or other content on this site.