After its $540M Argentina divestiture, Saputo (SAP) announced the £988M sale of its UK business - which represents roughly 7% of company revenue…

… and has faced margin pressure in recent years on a weaker product mix, inventory write-downs, and segment restructuring.

Assuming a normalization in segment profitability (14% margins), the transaction is priced around 10x EBITDA - in line with where SAP currently trades…

… so the deal looks good in my view, given it lets management recycle capital into its core North American operations and hit the buyback.

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