Gay Lea Foods provides update on the sale of Thornloe Cheese
Ontario’s largest dairy farming co-operative has reached a tentative agreement to sell ThornloeCheese to Triple “A” Cheese, a Mississauga, Ontario-based cheesemaker.
MISSISSAUGA, Ontario, July 3, 2024 – Gay Lea Foods today announced it has entered into a letter of
intent to sell Thornloe Cheese to Mississauga, Ontario-based Triple “A” Cheese.
A letter of intent is a non-binding, tentative agreement, which provides Triple “A” Cheese the opportunity to secure financing to construct a new cheesemaking plant near the current location. The proposed terms of sale would see Triple “A” Cheese acquire all Thornloe Cheese assets, including the plant, brand, cheese recipes and plant supply quota.
While this is a private sale and financial terms will not be disclosed, the organizations have agreed to a significantly advantaged sale price for the buyer, as well as deferred payment terms.
“We are pleased to have found a buyer with an innovative vision for Thornloe Cheese,” said Suzanna Dalrymple, president and CEO, Gay Lea Foods. “The current Thornloe Cheese plant requires significant investment and is no longer financially viable. We believe a different concept, and a new facility, are needed for the brand to thrive in Northern Ontario – and we’re hopeful the considerable effort invested in this project – by both organizations – will deliver that outcome.”
A new concept for Thornloe Cheese
The new concept for Thornloe Cheese is likely to include:
• A larger cheese manufacturing facility, with greater milk receiving capacity, on a more suitable
local property, serviced by municipal water supply and wastewater treatment.
• A tourist and local destination at the new location, complete with a fresh food store, coffee
shop or deli restaurant, party rooms, and a vibrant patio and outdoor space.
• Re-purposing the existing Thornloe Cheese location as a cold storage facility.
Triple “A” Cheese envisions its new operations would eventually employ more than 100 people (double the prior Thornloe Cheese employee population), while providing a permanent facility to process local dairy farmers’ milk.
“All of us at Triple “A” Cheese are excited by the prospect of turning this beloved, local brand into a destination that serves the community and attracts tourism to Northern Ontario,” said Stefano Camaiani, president and CEO, Triple “A” Cheese. “We must caution, however, that this is an ambitious project and there are no shortcuts. A new facility is needed and comes with significant funding requirements. There remains much work to be done.”
Financing requirements and timing
A key priority is to secure financing to purchase land and build the new facility. Gay Lea Foods is supporting Triple “A” Cheese in discussions with financers, including government agencies, to determine their interest in investing in this new concept.
“This has been a collaborative sale process, with both parties working toward a common objective,” said Dalrymple. “We are pleased to support Triple “A” Cheese in its efforts to bring this exciting new venture to fruition and are hopeful of a positive outcome for local Gay Lea Foods members and the community.”
If financing efforts are successful, the companies expect the sale would close in 2025, with the new plant to open in 2027 or 2028. Triple “A” Cheese will also explore the possibility of restoring limited interim cheesemaking at the current Thornloe plant, using equipment repurposed from its operations.
All aspects of the sale are contingent upon Triple “A” Cheese securing funding to build a new dairy plant near the current Thornloe Cheese location.
Grassfed milk
Gay Lea Foods will continue skimming grassfed milk at Thornloe Cheese until October 2024, as it has done since the plant stopped making cheese in October 2023. This premium milk is currently being used to make grassfed butter, with the skim used as part of the conventional milk supply. In October, Gay Lea Foods will stop receiving grassfed milk at Thornloe Cheese, but will continue paying farmers the grassfed premium until March 31, 2025.
Gay Lea Foods and Triple “A” Cheese will update the community as more is known about the sale of Thornloe Cheese, but encourage patience, as funding such an ambitious project takes time, and the outcome is inherently uncertain.
About Gay Lea Foods
Gay Lea Foods is a leading Canadian co-operative renowned for its community-focused values and high quality, innovative, and award-winning dairy and food products. With members on 1,300 dairy farms across Ontario and Manitoba, our farmers, shareholders and employees have proudly collaborated for more than 65 years to enrich communities co-operatively, ensuring the value our business creates flows to the members of our co-operative, our employees and the communities we touch.
About Triple A Cheese
Triple “A” Cheese is committed to excellence, and those roots run decades deep, starting over 25 years ago as a small, family-run cheese business. Today, Triple “A” Cheese is proud to be one of Canada’s largest feta cheese makers and top producers of quality dairy products. Still family-owned and based in Mississauga, Ontario, we pride ourselves on our reputation as a Canadian dairy industry pioneer, supplying the highest-quality products to private labels, wholesalers, food-service suppliers, and distribution and retail chains across North America.
Questions and Answers
Why did Gay Lea Foods purchase Thornloe Cheese?
Gay Lea Foods purchased Thornloe Cheese four years ago, with the intent to support dairy processing in Northern Ontario. We knew the facility was in poor physical condition and did not perform well financially. We made significant investments in the structure of the Thornloe Cheese building to ensure it was safe. We also made investments to improve sales and marketing in the hope of improving financial results.
Unfortunately, the recent food safety issue and physical condition of the facility interrupted these efforts and resulted in the necessary closing of the plant.
Is Gay Lea Foods willing to sell Thornloe Cheese?
Yes. As we have said publicly, and privately in conversations with community groups and local leaders, our preference is to sell the facility to a dairy operator if there is an interested buyer. Gay Lea Foods is willing to sell the facility, the Thornloe Cheese brand, and the plant supply quota, at a price that advantages a potential buyer.
We have received a few calls about the facility. These discussions are at a very preliminary stage.
We encourage interested buyers to contact us at communications@gayleafoods.com
Would Gay Lea Foods sell the equipment in the facility?
Yes. Gay Lea Foods will sell any equipment in good working condition. However, we will not sell any equipment that represents a food safety risk. Much of the equipment in this plant is decades old, has been repaired dozens of times, and is no longer safe.
Would Gay Lea Foods sell the plant supply quota?
Yes. As we have said publicly, and privately in conversations with community groups and local leaders, we are willing to sell the plant supply quota to a buyer who will operate a local dairy facility. In such a situation, we would also work with a buyer to support an application to Dairy Farmers of Ontario to transfer the plant supply quota to a new owner.
What is Gay Lea Foods’ asking price for Thornloe Cheese?
Pricing information will be shared with a buyer who is interested in operating the plant as a dairy facility. Our goal is to help a buyer be successful. As promised, Gay Lea Foods has not made any changes to the facility to allow a buyer the opportunity to conduct a full and thorough inspection.
Is there a deadline for the sale of the business?
At this point, no, because from the outset, we promised the community we would provide an opportunity for a buyer to step forward. However, it is in no one’s interest for the plant to sit idle for a lengthy period. A deadline will be established based on potential buyer interest.
Gay Lea Foods understands Thornloe Cheese is a point of community pride, which is why we purchased the facility in 2019. Unfortunately, current circumstances intervened. We are making our best effort to determine if there is a way to continue the legacy of Thornloe Cheese under new ownership. We are hopeful of a positive outcome, but are very early in the process, and it will take time to determine if there is a buyer.
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