TORONTO--Mexican baked goods giant Grupo Bimbo SAB looks set to complete its North American conquest via the purchase of Maple Leaf Foods Inc.'s Canada Bread Co. business for 1.83 billion Canadian dollars ($1.66 billion), a move that would immediately convert Bimbo into a top player in Canada's baked-goods sector.

The chance to absorb a third of Canada's packaged-bread market was essentially too good to pass up, Bimbo Chief Executive Daniel Servitje said on a conference call after announcing the deal Wednesday, calling Canada Bread "one of the single largest inorganic opportunities" left in North America.

"We will now have a leading presence in the three countries of the North American region," Mr. Servitje added.

Mexico City-based Bimbo has agreed to pay C$1.65 billion to Toronto-based Maple Leaf, which owns about 90% of Canada Bread. Bimbo is offering minority shareholders the same buyout price, or C$72 a share. Canada Bread shares closed at C$67.26 in Toronto Tuesday.

For Maple Leaf, the sale marks the end of an exploration of strategic options for its bakery business launched last October. "This transaction maximizes the value of our investment in Canada Bread and focuses Maple Leaf on building its leadership in the consumer packaged-meats business, " said Michael H. McCain, Maple Leaf's president and chief executive.

The deal is subject to court and regulatory approvals, including approvals from Canada's Competition Bureau and Canada's industry ministry. Bimbo expects the purchase to close before July of this year.

Maple Leaf said the continuing restructuring of its prepared-meats business "significantly impacted" earnings in 2013, particularly fourth-quarter results. Its bakery business, however, performed at record levels, the company said.

Bimbo, which has grown through a number of major acquisitions in recent years, said it has cash holdings and credit arrangements in place to fund the purchase. In 2008, Bimbo paid about $2.4 billion for Canada's George Weston Ltd.'s eastern U.S. bread business, complementing its 2002 purchase of George Weston's western U.S. baked-goods operations. Then, in 2011, Bimbo bought the fresh bakery operations of Sara Lee for $709 million.

Despite the aggressive expansion into the U.S., which is now Bimbo's biggest market by sales, Bimbo remains heavily reliant on its profitable Mexican business. During the 12 months through September, Mexico supplied 63% of Bimbo's $1.3 billion in earnings before interest, taxes, depreciation and amortization, or Ebitda, even though Mexico accounted for just 39% of Bimbo's $13.8 billion in revenue. On a pro-forma basis, Canada Bread would have accounted for $1.4 billion, or 9%, of Bimbo's 12-month sales and 13% of Ebitda, the company said.

Bimbo officials welcomed the chance to diversify the company's revenue via Canada Bread, which boasted an attractive mid-single-digit growth rate in packaged bread sales in recent years. Mexico enacted an 8% tax on high-calorie snacks this year that could curb Bimbo's sales of sweet treats in its home market.

Canada Bread operates 25 facilities in Canada, the U.S. and the U.K. and together with George Weston's Weston Foods division dominates the Canadian packaged bread market. Mr. Servitje said the company fits into Bimbo's "strategic sweet spot" for acquisitions, because of its leading position throughout Canada and strong brand loyalty. He also praised the company's deep ties with Canadian retailers, know-how in the frozen bread business and potential for research and development of new products.

Canada Bread and George Weston each control close to a third of the Canadian packaged-bread market. Canada's overall baked-goods market is worth about $40 billion, according to Euromonitor International.

Bimbo's entry into to the Canadian market isn't likely to shake the competitive landscape for George Weston, analysts said. "It's a duopoly, " said Robert Gibson, an analyst with Octagon Capital. "They [Bimbo] just made a huge acquisition. They don't want to go into a price war right now. They want to keep things as they are and gets some benefits [from the deal]."

While Bimbo is likely to put some "fresh air" into Canada Bread through new investments and product offerings, Canada is a saturated bread market that will make it tough for industry players to eke out market share gains, said Svetlana Uduslivaia, senior research analyst at Euromonitor International.

David George-Cosh and Anthony Harrup contributed to this article.

Write to Amy Guthrie at amy.guthrie@wsj.com and Judy McKinnon at judy.mckinnon@wsj.com

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