Cherkizovo plans to acquire Siberian poultry producer

18-07-2018 | | |
Cherkizovo plans to acquire Siberian poultry producer. Photo: Shutterstock
Cherkizovo plans to acquire Siberian poultry producer. Photo: Shutterstock

Major Russian meat group Cherkizovo has announced plans to buy Altaisky Broiler, one of Russia’s largest poultry producers, as it stands by its commitment to make itself the largest meat player in the country.

Letter of intent signed

In line with its focus on extensive business growth, Cherkizovo Group has signed a letter of intent to buy, Altaisky Broiler.

Acquisition will open access for Cherkizovo to Siberia

In 2017 Altaisky Broiler produced 67 thousand tons (live weight) of poultry products. Cherkizovo said its purchase would considerably expand its business footprint, open up access to the Siberian market, and add one of the strongest and most popular local brands to the Group’s portfolio. It said it will also strengthen Cherkizovo’s positions in the poultry market and increase its share among domestic poultry producers to 12%.

About Altaisky Broiler

The top poultry producer in the Altai Territory, Altaisky Broiler is also among the largest poultry producing companies in the Siberian Federal District. The company supplies frozen and chilled whole chickens, chicken meat, and by-products. Capacity of the company’s farms is enough to supply the entire Altai Territory and neighbouring regions with quality chicken meat.

Established in 2007, Altaisky Broiler delivered its first products to the market in December 2008. Today, it is a state-of-the-art poultry production facility comprising a hatchery, a feed mill, four fattening sites located in the Zonalny District of the Altai Territory, a slaughterhouse, and a meat packing plant in Biysk. Chickens are raised on a well-balanced diet of compound feeds produced in-house.

Acquisition price yet to be determined

The transaction will be closed after legal and financial due diligence of the target company is completed, and the final acquisition price is yet to be determined by the parties. The anticipated acquisition is also subject to approval by the Russian Federal Antimonopoly Service.

Voronezh oblast next target for Cherkizovo

The announcement came in the same week as the company said it would also – over the next decade – target the Voronezh oblast in the west of the central belt of European Russia for further expansion.

The firm has already established a strong base in the region, but top priority now for Russia’s largest vertically integrated meat and feed producer is to acquire more land to increase its crop production to the levels it achieves in neighbouring regions.

Building plans in Voronezh for 32 poultry houses

Already Voronezh’s largest poultry producer since acquiring Lisko Broiler in 2014, Cherkizovo has announced new plans to build a further 32 poultry houses in the region. Together with the expansion of the slaughterhouse, the cost of the investment will be RUB2 billion roubles (US$33 million).

When fully operational by 2018, the company’s poultry meat output in the region will increase 20% from the current 110,000 metric tons per year to 130,000 metric tons.

AI prompts EU ban on Russian poultry

In separate news, the European Union has banned the import of poultry meat and other related products from Russia due to concerns regarding avian flu, according to the Russian Federal Service for Veterinarians. A total of 18 Russian businesses certified to export poultry to the EU will be affected

Tony Mcdougal Freelance Journalist