Smithfield Foods secures majority stake in Spain’s Argal Group in strategic partnership for packaged meat expansion
USA – Smithfield Foods, the European branch of the US-based pork producer, has revealed a partnership with Argal Group in Spain, with Smithfield securing a 50.1% ownership in Argal.
The collaboration designed for a medium-term approach, involves both companies operating within an agreed-upon joint management structure.
Smithfield Foods, a major pork producer with a presence in Europe, is set to acquire a majority interest of 50.1% in Argal Group, a Spanish company specializing in packaged cold cuts. The existing stakeholders of Argal will retain the remaining shares.
Argal Group specializes in manufacturing a range of charcuterie products, including cooked and cured ham, bacon, turkey, sausages, fuet, and pâté.
Through this strategic partnership, Argal will gain access to Smithfield’s distribution channels in Europe and benefit from a vertically integrated supply chain, in addition to other valuable assets.
Smithfield conducts operations across Europe, with facilities for hog processing, plants, and corporate offices located in Central and Eastern Europe, including Poland, Slovakia, Hungary, and Romania.
Argal, on the other hand, operates production centres in Catalonia, Navarra, and Extremadura, alongside nine distribution centres elsewhere in Spain. The company exports its products to more than 30 countries through its subsidiaries or distributors.
Antonio Escribá, Chairman of Argal, and CEO José María Orteu, stated that this investment will expand the company’s growth opportunities, supporting internationalization, technological advancement, sustainability, and overall competitiveness.
He noted that it will also enable Argal to address forthcoming business challenges relating to food and its various marketing channels to reach customers and consumers.
Furthermore, this partnership is expected to create avenues for the professional and personal development of Argal’s team.
According to the joint announcement, Argal anticipates achieving €440 million (US$468.8 million) in revenue for the fiscal year 2023.
Luis Cerdan Ibanez, Executive Vice President of European Operations at Smithfield, highlighted that this investment is in line with the company’s strategy to strengthen its assortment of packaged meats in Europe.
He praised the quality of Argal’s products, its workforce, and its management team, underscoring the partnership as a robust foundation for their expansion in Spain and Europe.
Meanwhile, Smithfield Foods has been under the ownership of China’s WH Group since 2013, with WH Group being headquartered in Hong Kong.
In related news, Smithfield’s US meat business recently announced the closure of its pork processing plant in Charlotte, North Carolina, with repercussions for 107 employees.
