Maple Leaf Foods (MFI) has completed the spin-out of its pork business, Canada Packers (CPKR) - a move investors expect will drive margin expansion…

… and further leverage reduction, which should support continued improvement in MFI’s return profile.

With its heavy CapEx cycle now over…

… proof of execution and the stability coming from this pork carve-out could drive a multiple re-rate for MFI.

If nothing else, the separation was opportunistic - with Canada Packers being Maple Leaf’s fastest growing segment…

… driven by persistent inflation in beef, which has shifted demand to substitutes like pork…

… at a time when supply hasn’t kept pace, pushing prices higher…

… while key feed inputs like corn and soybean have gone in the opposite direction.

That’s driven a period of strong profitability, making it a perfect time to market a standalone entity. But as history has shown, pork is a cyclical business…

… and with shares down 12% in the first day of trading, my fingers are crossed that we don’t end up with a replay of Telus Digital. If we do, MFI could “bring home the bacon” when the cycle turns.

Open Text (OTEX) announced another non-core divestiture, selling eDOCS to NetDocuments for $163M. The deal sheds $30M in revenue (sub-1%) and tightens the focus on its cloud business…

… and financial position, with the proceeds earmarked for leverage reduction.

The sell-down continues the company’s shift away from the former CEO’s M&A focused growth strategy…

… a narrative the market appears to be warming up to, with the stock up nearly 30% since new leader James McGourlay took over in August.

Alberta intends to submit a pipeline proposal by May, aiming to send oil to the west coast in order to reduce U.S. market reliance. Given historical precedent, there’s no private capital behind this today…

… making it an easy target for BC, who stands firmly against changing the tanker ban. As production eventually outgrows existing capacity, a new pipeline would keep the Canadian oil discount at a minimum…

… and bring investor sentiment towards the sector back from the grave. Let’s see how it plays out.

There’s been a lot of small deals recently:

Some other noteworthy press releases:

BRP Inc. (DOO) gained 4% today after making changes to its debt stack - netting out to a $200M repayment, $265M extension, and a 50 bps interest rate reduction. The company’s new strategic plan is coming next week, likely targeting margin expansion…

… and top-line growth, which re-accelerated in Q2 for the first time in eight quarters.

Up ~20% since then and priced slightly above its long-term average, the event could dictate where it trades from here.

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