Hi-Pro Feeds is one of the largest providers of animal feed in North America, producing over 1.5 million metric tons of feed annually. Birch Hill partnered with management in early 2012 to complete a corporate carve-out of the feed division of Viterra Inc., which consisted of 14 facilities across Canada and the United States.
Birch Hill saw an opportunity to purchase a unique set of assets with attractive regional competitive dynamics at a fraction of replacement value. We also believed that there was an opportunity to materially improve margins.
During Birch Hill’s ownership, we transformed the operating model of a low margin feed manufacturing business into a value-added service offering which included developing the industry’s most advanced nutrient delivery system to ensure we supplied the highest value, lowest cost feed for our customers. This shift in strategy resulted in the tripling of EBITDA margins over our hold. Birch Hill’s willingness to commit time, capital and provide strategic guidance was crucial in supporting the management team’s execution of this transformation.
ROI – In June 2017, Hi-Pro was sold to Nutreco, who recognized the value of Hi-Pro’s unique operating model and strong team. Over our hold, we increased EBITDA by 3.7x representing a compound annual growth rate of 30%.