CPF to Buy Russia Pork Producer26 July 2013
THAILAND - Thai food producer Charoen Pokphand Foods Plc (CPF) plans to spend 3.15 billion baht (€78.6 million) to acquire an 83 per cent share of Russia Baltic Pork Invest ASA (RBPI), a large grain and pork producer in the Kaliningrad region of Russia.
Bangkok Post reports that CPF Investment Limited (CPFI), a subsidiary of CPF, will purchase the shares from Capman Russian Fund LP in the third quarter of this year.
RBPI, which also has operations in Nizhny Novgorod and Penza, is plans to expand its operations into mainland Russia.
President and chief executive officer of CPF Adirek Sripratak said the deal is part of the company's expansion plan into food and in Russia, where the company already operates a feed mill and integrated swine businesses.
In 2009, CPF, the food flagship of Charoen Pokphand Group, made a 3.5 billion baht investment in advanced feed mills and swine farms in Lukhovitsy county.
The investment aims to serve the growing meat consumption of Russians, which stands at about 2.75 million tonnes a year while local production capacity remains low, leading to the import of around 750,000 tonnes of pork every year.
RBPI last year reported sales of 1.39 billion baht with 343 million baht net profit, the Bangkok Post reports.
CPF projects sales this year to increase by 10-15 per cent from 357 billion baht generated in 2012. Operations in 12 countries including Russia are expected to contribute about 55 per cent of revenue in 2013, thanks to aggressive investment expansion in recent years.
Mr Adirek said the company board also approved the use of 1.2 billion baht to acquire 59.99 shares of CP-Meiji Co (CP-Meiji), which manufactures and distributes dairy products.
The company now offers dairy products such as pasteurised milk, yoghurt, cup yoghurt and drinking yoghurt under the Meiji and Meiji-Paigen brand. Last year's sales were 5.17 billion baht with 206 million baht in net profit.
TheMeatSite News Desk