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Rogers Sugar, whose plant in Taber, Alta., is seen above, has made scouting for maple-syrup acquisitions a part of its game plan, CEO John Holiday says.Larry MacDougal/The Canadian Press

Rogers Sugar Inc. has been a consolidator in the tightly controlled maple-syrup business. More deals look to be on tap.

On Monday, Rogers announced its second acquisition in the segment, paying $40-million for privately held Decacer, a bottler of branded and private-label syrup based in Lévis, Que. The transaction comes less than four months after closing its $160-million purchase of LB Maple Treat Corp., one of the industry's largest players.

From a standing start in July, Rogers now has a 28-per-cent share of the global market for the gooey treat, and may grab more. Indeed, in announcing the LB deal last summer, chief executive officer John Holliday said scouting for maple syrup acquisitions was now part of the game plan.

It represents a major new line in addition to the trade-barrier-protected business of granulated sugar for Montreal-based Rogers and its Lantic and Rogers brands, which have long enjoyed a virtual duopoly in Canada along with Redpath Sugar Ltd.

That comfy position made the onetime income trust a reliable investment for dividend buffs, but offered precious little pizazz in the way of expansion prospects.

"This has changed with the addition of LBMT and Decacer, as they provide material exposure to the much faster growing maple syrup category and create the potential for market share gains through new customer wins and additional tuck-under acquisitions," Michael Van Aelst, analyst at TD Securities, wrote in a note to clients.

Investors applauded the debt-funded Decacer deal on Tuesday, pushing Rogers shares up 6 per cent. They are up 8 per cent from $6 in early July, just before the company made its foray into syrup.

Decacer's own brand includes varieties of syrup ranging from golden with a delicate taste to very dark with a strong taste. The company also uses a dehydration process to make maple flakes and sugar.

Forty-seven per cent of its products are sold in Canada, 13 per cent in the United States and the remainder in the rest of the world.

Rogers said it expects to realize savings in the operations over the next 12 to 18 months. It is paying 7.8 times adjusted earnings before interest, taxes, depreciation and amortization, which is slightly less than the multiple for LB, excluding projected operational savings.

Maple syrup is a logical extension to the traditional sugar business, and not just because of the similar appeal to the world's sweet teeth. Both have formal trade protections built in.

Quebec, home base to LB and Decacer, is often called the OPEC of syrup, but that doesn't do it justice. With nearly three-quarters of world production, the province has three times as much clout in markets for its product than the oil cartel has in global energy.

Its Fédération des producteurs acéricoles du Québec controls prices through supply management, meaning producers enjoy rock-solid stability in their revenues as global consumption grows at a healthy clip each year. It even operates strategic syrup reserves – another similarity to the world's oil industry.

Meanwhile, there are more acquisition candidates for a buyer such as Rogers. Quebec is home to 75 bottlers and processors, 21 of which have revenues of more than $1-million and could be future targets, Desjardins Securities analyst Frederic Tremblay wrote in a note to clients.

"This supports our view that the maple syrup products market offers not only healthier organic growth prospects than the Canadian refined sugar market, but also a larger number of M&A opportunities," Mr. Tremblay wrote.

A major publicly traded company scooping up smaller players, including many mom-and-pop operations, changes the face of the industry and of Rogers itself.

Maple syrup now accounts for a fifth of its revenue, and 70 per cent of that is derived from sales outside Canada. This, just before competition in granulated sugar potentially heats by the end of next year, amid only minor increases expected in domestic demand, Mr. Van Aelst said.