TORONTO — Canada Bread Company, Ltd. said it has reached agreement with the City of Hamilton, Ont., to construct a 375,000-square-foot baking facility. Canada Bread first announced plans for the facility, which will be the largest baking plant in Canada, on Jan. 12.

“We are very pleased to be growing our presence in Hamilton through this C$100 million investment to establish a world-class bakery facility,” said Richard Lan, president and chief executive officer of Canada Bread. “This city is a great location to support our continued growth with a skilled workforce, excellent infrastructure, and ready access to markets. These benefits collectively led to our decision.”

According to Canada Bread, the government of Canada, though the Southern Ontario Development Program, has agreed to provide C$2 million in the form of a repayable contribution to be used toward pre-engineering and design activities to build the new facility.

Construction on the facility is expected to begin by June, with the first production lines commissioned approximately 12 months later. In line with the new facility opening, Canada Bread is closing its three existing bakeries in the Greater Toronto area. Production will be transitioned over a two-year period as operations at the three plants are wound down, with the first bakery currently expected to close in late-2011, the next in early 2012 and the third in early 2013.

The baking facility will not be Canada Bread’s only presence in Hamilton. The company employs approximately 340 people at its Fresh Bakery and Olivieri pasta facilities in the city.