Hershey secures deal to repurchase Canadian facility previously sold in 2007
The renowned confectionery company Hershey has announced the acquisition of its former Hershey Drive site in Ontario, Canada, which was sold in 2007 to cannabis company Canopy Growth.
As part of the agreement, Hershey will pay approximately C$53m ($39.2m) for the facility located in Smiths Falls.
Hershey originally closed the site in February 2007 during a series of factory closures in North America, but Canopy Growth acquired it in 2017. Canopy Growth has been striving to reduce costs and fortify its balance sheet amidst competition from illicit sources in Canada and the slow pace of cannabis legalization in the US.
A Hershey spokesperson mentioned that it is too early to speculate on which Hershey brands will be produced at the 700,000 sq ft Ontario facility, or when operations will begin.
In a statement, the spokesperson added, “This strategic acquisition reinforces our investment in the supply chain network and supports our vision of becoming a leading snacking powerhouse. The facility grants us versatility to drive growth across our candy, mint, and gum portfolio.”
Hershey currently operates a distribution facility in Brantford, Ontario, which caters to its business operations in North America. The company’s local office is located in Mississauga, Canada. However, Hershey does not disclose specific sales figures for the country.
In 2022, Hershey reported net sales of $10.42bn, reflecting a 16.1% increase compared to the previous year. Excluding exchange rate impacts, the company achieved a 12% organic growth in net sales.
Hershey’s net income also saw a 12% rise, totaling $1.64bn.