Maple Leaf Foods shares tumble after Teachers sells its entire stake in company

The company's stock closed down $1.28 at $11.41 at the Toronto Stock Exchange, off a sharper decline of as much as $1.55 earlier in the session. On Tuesday, the OTPP said it would sell its holdings in Maple Leaf for just under $362.4 million, a 17 per cent discount to the market price prior to the announcement.

The Canadian Press
November 24, 2010

Maple Leaf Foods shares tumble after Teachers sells its entire stake in company

TORONTO - Shares of Maple Leaf Foods (TSX:MFI) tumbled 10 per cent Wednesday in the wake of the Ontario Teachers Pension Plan Board's decision to sell its entire 25 per cent stake in the Canadian food processor and bakery at a discount.

The company's stock closed down $1.28 at $11.41 at the Toronto Stock Exchange, off a sharper decline of as much as $1.55 earlier in the session.

On Tuesday, the OTPP said it would sell its holdings in Maple Leaf for just under $362.4 million, a 17 per cent discount to the market price prior to the announcement.

The OTPPB initially sold a block of about 21 million common shares Tuesday afternoon to a syndicate of underwriters but later in the day increased that to more than 34.5 million shares.

In both cases, the shares were sold for $10.50 each.

It was no secret that Teachers was rethinking its position at Maple Leaf Foods — a company that OTPPB has backed since it joined the family of Wallace McCain to buy Maple Leaf from Hillsdown Holdings in 1995.

The pension announced in July 2009 that it had notified McCain Capital Corp. that it would terminate the agreement between the family company and Teachers, effective at the end of June 2010.

In August, teachers sold, also at a significant discount, a 10 per cent stake in the food processor to activist hedge fund West Face Capital Inc., known for cracking down on the operating costs of companies.

Maple Leaf, which is also Canada's largest baker through its Canada Bread subsidiary, employs about 23,500 people at operations across Canada, the U.S., the U.K. and Asia.

http://ca.news.yahoo.com/s/capress/101124/business/maple_leaf


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