Struggling Menu Foods bought by Simmons Pet Food

The deal is to be closed at US$232.9 million and includes Simmons’s assumption of Menu Foods’ debt.

Menu Foods came into trouble in 2007 after a large recall when it distributed pet food tainted with melamine, a product masking protein content in wheat gluten and rice protein concentrate, which were imported from  China.

The tainted food was blamed for sickening or killing hundreds of cats and dogs in North America.

The Mississauga, Ontario-based company recalled at least 60 million packages of pet food involving more than 60 different brands it had made for other companies.

The food was sold under well known labels such as Procter & Gamble’s Iams cat food and private-label brands sold by retailers such as Wal-Mart and Safeway.

The scandal resulted in the company losing major customers that represented roughly 37% of its sales.

Poor Q1

When reporting its first-quarter results for this year in May it said the reverberations of the recall were still being felt and were partly responsible for a 25% drop in sales.

The Canadian company never really recovered from the recall and managed to stay alive for three years, which was already longer than expected. The Menu Foods name is too tainted for survival and it makes more sense to continue operations under another umbrella.

Simmons Pet Food is an affiliate of Simmons Foods Inc., an Arkansas-based chicken company with annual sales of more than $1 billion.