Kepak has agreed to buy the UK business and assets of 2Sisters Red Meat, part of the 2Sisters Food Group, from its parent company Boparan Holdings for an undisclosed sum. The package includes three abattoirs - McIntosh Donald at Portlethen in Scotland and two St Merryn sites – Merthyr in Wales and Bodmin in Cornwall. There is also the St Merryn Victoria retail and foodservice packing facility; St Merryn cold storage and distribution facility at Truro and central office at Talgarrek House, St Merryn – all in Cornwall.
The Kepak Group, , based in Clonee, Co Meath, generates annual revenues of €950 million through the slaughter of some 275,000 cattle, 600,000 lambs and 350,000 pigs each year, and is a significant food manufacturer under its Rustler brand. The AgraKepak export subsidiary trades an annual 65,000 tonnes of beef, pork, lamb and fish proteins on global markets, particularly in Asia and Africa.
2Sisters Red Meat processes and markets around 250,000 cattle and a million lambs each year, drawn from 13,000 farmer suppliers from Scotland to Cornwall.
Kepak says the move will significantly increase the value and scale of the Group and strengthen key customer supply chain partnerships, particularly as both businesses are Tesco suppliers. It will provide a sustainable source of UK raw material for the Group’s meat-based food operations in the UK and Ireland, which supply both these domestic markets and European customers.
The deal is also a Brexit and €/£ hedge for Kepak’s existing and new Irish-UK businesses.
Boparan Holdings first acquired the businesses through its purchase of the UK poultry and red meat processing interests of the Dutch co-operative Vion Food Group in 2013. Vion, in turn, had bought them from the struggling Grampian Country Food Group in 2008, but had failed to turn round the operations in the subsequent difficult trading conditions.
“Kepak has a clear strategy to grow its meat and food businesses in partnership with key customers and in markets that are complementary to our existing businesses in Ireland and in the UK,” states Kepak Group managing director John Horgan. “This red meat business, with its very solid UK retail, foodservice and manufacturing relationships, is a great fit for Kepak. We will collaborate closely with the livestock farmers who have been loyal suppliers to these UK sites for many years.”
2Sisters is reported to be focusing on its core poultry meat interests. Earlier this year, the company was caught up in a food standards media storm, and it has recently divested some non-core convenience food manufacturing activities.
“We are pleased to announce this transaction of our Red Meat business,” says president of Boparan Holdings Ranjit Singh. “Kepak Group is the ideal home for our Red Meat business, and this deal is a perfect strategic fit for them. This deal represents another major step in transforming 2 Sisters and building a better business.”