The Kraft Heinz Co. closed its sale of its Canadian natural cheese business to Parmalat for approximately $1.24 billion. The agreement includes Cracker Barrel, P’tit Québec and aMOOza! brands in the Canadian market.

The natural cheese business contributed about $427 million to Kraft Heinz’s net sales in 2017, according to the initial announcement in November. Kraft Heinz expects to use transaction proceeds to pay down debt, with reduced interest expenses expected to offset the majority of EPS dilution on a run-rate basis.

Under the terms of the transaction, Parmalat, whose parent company is listed on the Italian stock exchange, acquired Kraft Heinz’s production facility in Ingleside, Ontario. Kraft Heinz will continue to own and market its other cheese products, including iconic brands such as Philadelphia, Cheez Whiz and Kraft Singles, which are manufactured in Mount Royal, Quebec, where Kraft Heinz Canada employs approximately 900 people.

“We’re excited about what this transaction means for our future growth and business in Canada,” Kraft Heinz' former CEO Bernardo Hees said when the deal was announced. “We also believe Parmalat is uniquely positioned to advance the natural cheese business given their experience and focus on the dairy industry. At the same time, we can focus on the segments and categories where we have stronger brand equity, competitive advantage and greater growth prospects.”

Kraft Heinz is the fifth-largest food and beverage company in the world. Its brands include Kraft, Heinz, ABC, Capri Sun, Classico, Jell-O, Kool-Aid, Lunchables, Maxwell House, Ore-Ida, Oscar Mayer, Philadelphia, Planters, Plasmon, Quero, Smart Ones and Velveeta.