SAO PAULO (Reuters) - McCain Foods SA, the world’s largest producer of frozen fries, has agreed to buy 70 percent of Brazilian firm Sérya for an undisclosed amount, in a deal that will allow the Canadian company to expand its footprint in Latin America’s largest market.
The remaining shares of Sérya are held by Brazilian cheese bread maker Forno de Minas, in which McCain acquired a 49 percent stake in March 2018, the company said in a statement on Friday.
A person familiar with McCain’s operations in Brazil told Reuters that McCain’s Brazilian subsidiary received a $15 million capital injection from the parent company this week to secure the deal.
The source, who asked not be named to openly discuss the company’s plans, said McCain also expects to buy the remaining stake in Forno de Minas within the next five years.
Based in Araxá, a city in the southeastern state of Minas Gerais, Sérya has a factory in Brazil with an annual production capacity of 12,000 tons. Its acquisition is seen as McCain’s first step to produce frozen potatoes locally.
So far, the company supplies the Brazilian market, including fast-food chains such as McDonald’s, with products imported from other countries, mostly Argentina.
“Brazil is the world’s fifth largest market for frozen potatoes, with large potential to become the third by 2021,” McCain’s general-director for Brazil, Aluizo Neto, said in a statement.
Reporting by Gabriela Mello; Editing by Leslie Adler