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2 Sisters Buys Vion's Red Meat and Poultry Businesses

05 March 2013

UK - Dutch-based food producer VION NV is to sell its red meat and poultry businesses to Boparan Holdings Limited, the holding company for 2 Sisters Food Group.

The acquisition by 2 Sisters secures a viable future for these businesses, as well as providing certainty to their UK supply chain, which is underpinned by British farmers.

The acquisition will help to meet growing demand from 2 Sisters’ poultry customers and further diversifies the company’s offering to include red meat, supporting 2 Sisters’ strategy of serving more meal occasions.

The deal follows the strategic decision VION announced on 19 November last year that it was selling its UK food operations to focus on its core food activities in the Netherlands and Germany and its global ingredients business and the subsequent management buy-out of its UK Pork activities in January of this year.

VION’s poultry and red meat businesses are suppliers of poultry, beef and lamb to the retail and food service sectors in the UK and Europe. They have 11 processing sites in the UK and approximately 6,000 employees and have suffered from challenging trading conditions, in particular in poultry, with the loss of a number of major contracts.

Ranjit Singh, Chief Executive of 2 Sisters Food Group, said: “We are delighted to be acquiring VION’s UK’s poultry and red meat businesses. They have faced significant uncertainty and tough trading in recent months, but today’s acquisition secures a viable future.

"With the majority of the operations being in Scotland and Wales, we are delighted that the Scottish and Welsh governments are supportive of this deal and we look forward to working with them and developing a sustainable future for these businesses.

"This acquisition will safeguard a key supply chain for high quality British poultry and meat, offering reassurance to farmers in England, Scotland and Wales and upholding the quality and provenance that UK consumers deserve.

"At 2 Sisters, we put the customer at the heart of everything we do and in line with our customers’ strategies, these businesses will help us to shorten the supply chain for consumers and meet growing demand for British sourced food. Our immediate focus will be to improve performance, as we have successfully done with our previous acquisitions. We look forward to welcoming VION’s colleagues to 2 Sisters Food Group, and to working together to grow our business.”

Peter Barr, chairman of VION UK, said: "We are pleased to have reached such a positive conclusion to our discussions with 2 Sisters, one of the food sector's most successful and respected businesses. We would like to take this opportunity to thank all of our employees for their support and commitment to the business during these challenging times and to wish the 2 Sisters team every success with the newly-expanded operation."

Edwina Hart AM, Welsh Business Minister, said: “I welcome today's announcement that 2 Sisters is to acquire VION’s poultry and red meat businesses, which safeguards the future of their operations in Wales. We have been working closely with both VION and 2 Sisters to help secure this deal in order to sustain the future for the workers and the supply chain in Wales."

John Swinney MSP, Secretary for Finance, Employment and Sustainable Growth in the Scottish Government, said: "I am delighted that 2 Sisters Food Group has agreed to buy VION. I first called for a sale last November because of the uncertainty facing VION and its importance to the Scottish food sector. Today's announcement is a significant step forward and my officials and I look forward to working with 2 Sisters over the coming months, in order to secure a sustainable future for VION and its plants in Scotland."

VION continues to explore opportunities for its Welsh Country Foods business which is currently in a 90 day consultation process following its key customer delisting it as a supplier.

National Farmers' Union President Peter Kendall said the move would help to safeguard a key supply chain for UK producers and maintain the UK's processing capacity to meet the growing demand for British sourced food.

Mr Kendall added: "Since the sale announcement by Vion in November, there has obviously been a degree of uncertainty for farmer suppliers, so this acquisition will come as good news and will help offer some reassurance to farmers across England and Wales.

"The purchase will safeguard a key supply chain for high quality British beef, lamb and poultry and the NFU will be arranging a meeting with 2 Sisters to help build a profitable future for British livestock farmers.

"This development will help to maintain and improve the UK's processing capacity and it is critical, following Tesco's announcement to source 100 per cent UK fresh chicken by July 2013, that the industry is able to respond to the growing demand for British sourced food. This move will help deliver shorter supply chains and increased traceability, and we hope it will be another step to developing a more sustainable, fairer and transparent supply chain for farmers across England and Wales."

TheMeatSite News Desk

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