A worker harvests cucumbers in a greenhouse at Mucci Farms in Kingsville, Ont., in June, 2024.Geoff Robins/The Globe and Mail
Grocery magnate Galen G. Weston is committing $100-million to making it easier for Canadian shoppers to buy local.
Wittington Investments Ltd., the Weston family holding company that controls retailer Loblaw Companies Ltd. L-T, is launching a $100-million fund focused on building the resilience and scale of Canada’s food producers.
The fund is part of Mr. Weston’s pledge of $1-billion in “philanthropic funding, with the specific goal of strengthening Canada” at May’s annual meetings for Loblaw and parent George Weston Ltd. WN-T Mr. Weston is chairman of both companies, and chief executive officer of George Weston.
Jim Orlando, managing partner at Wittington Ventures, will lead the new fund as head of a four-person team, along with his ventures portfolio. In an interview on Wednesday, Mr. Orlando said: “We see building food security in Canada as essential to building a strong nation.”
The fund plans to commit between $5-million and $10-million to each business it backs. The fund will make equity and debt investments, depending on the needs of the business, and will typically take minority ownership stakes. Mr. Orlando said, “Our focus will be on everyday essentials.”
The fund will have a wide scope, ranging from backing new product launches to investing in the infrastructure needed to help Alberta ranchers raise more cattle without having to ship them to U.S. feedlots.
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For example, imported fruits and vegetables account for roughly 65 per cent of Canadian grocery store produce sales. Mr. Orlando said the Wittington fund could back domestic producers such as greenhouse owners who need capital to build facilities in order to displace imports.
Stocking shelves with homegrown goods made sense for businesses long before U.S. President Donald Trump’s trade war threats made buying Canadian a patriotic duty. “Local produce is fresher, so it has a longer shelf life, and easier to transport, which means a smaller environmental footprint,” said Mr. Orlando.
Wittington is making a commitment to domestic food producers as numerous retailers run campaigns designed to get shoppers to support the home team. Protein producer Maple Leaf Foods Inc. told customers to “Look for the leaf” on its chicken and hot dogs, while grocer Metro Inc. played on the “elbows up” approach to U.S. relations with “Bags Up” advertising meant to highlight Canadian products.
While Loblaw will always be a potential customer for companies that Wittington backs, Mr. Orlando said his team will encourage businesses to sell their products to every possible retailer.
In additional to cash, the fund can leverage Loblaw’s market knowledge to help identify opportunities, which Mr. Orlando said offers small to mid-sized business a competitive advantage as they expand. The Wittington fund expects to make its first investment by the end of October.
Wittington is committed to reinvesting any profits from investments back into the fund, which Mr. Orlando described as a “circular” approach that will allow capital to compound.
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The Weston family also plans to keep the food fund running indefinitely. In contrast, most private equity funds wind down after 10 to 12 years and pay out their backers.
In May’s annual meetings, Mr. Weston said the family’s approach to investing in food security, health care and conservation would focus on innovations that could be scaled up to deliver a “national impact.”
“We will look for new projects and people – with ideas that can directly and positively improve the lives and prosperity of Canadians,” said Mr. Weston in his speech to Loblaw and George Weston shareholders.
The Weston family also used the circular approach on the Wittington Innovation Fund, a $100-million venture launched last year and focused on health care and climate technology. In January, Wittington’s Canadian Innovation led a $14-million investment in Grey Matter Neurosciences Inc., which is working on treatment of Alzheimer’s disease and other brain ailments.
Wittington has significant capital after cashing out on a number of successful investments, including the 2021 sale of British luxury retailer Selfridges & Co. for an estimated $6.9-billion.
The same year, Wittington recruited a new president, former corporate lawyer Cornell Wright from Torys LLP, and placed an emphasis on taking direct stakes in companies through its own team of investment professionals, rather than putting the Weston family’s money in externally-run private equity funds. Wittington Ventures has invested in 15 businesses over the past six years.
Mr. Orlando joined Wittington in 2019 after spending 11 years at the venture capital and private equity arms of the $141-billion Ontario Municipal Employees’ Retirement System (OMERS) pension plan. As a managing partner at OMERS Ventures, he led early-stage investments in successful tech companies such as Shopify Inc. and Wattpad.
Wittington is expanding the scope of its investments and making long term commitments to startup food, health and tech companies as its publicly traded businesses turn in strong stock market performance. The price of Loblaw shares has more than tripled over the past five years, while George Weston’s share price has more than doubled.