SPAIN – Grupo Vall Companys, one of the largest poultry companys in Spain, has come to an agreement with a local poultry firm Grupo Sada to acquire the majority shares of the poultry company.
Under the agreement, the family-owned meat processor will buy 75% of Grupo Sada,one of the country’s top five meat processors.
Vall Companys will also acquire Grupo Sada’s subsidiary Sada Canarias from the Netherlands agri-food business Nutreco.
The transaction, struck for an undisclosed sum, awaits authorization and approval from Spain’s competition watchdog Comisión Nacional de los Mercados y la Competencia (CNMC).
Grupo Sada has five plants, with four on the Spanish mainland and another in Tenerife that supply poultry products to retailers and the foodservice sector.
Its acquisition will bolster Vall Companys’ poultry division which is comprised of four slaughterhouses and five cutting rooms that have an annual production capacity of more than 115,000 tons.
The unit processes chicken and turkey into fresh and frozen products and generated a turnover of EUR350m (US$365.1m) in the group’s 2020 fiscal year.
The acquisition of the majority share by Grupo Vall Companys in Grupo Sada comes at a time when the Poultry Meat Processing industry in Spain valued at €4.6bn in 2022 has been growing steadily.
The market ranked 5th in Europe in 2022 (of 22 total EU countries), achieving a growth of 4.3% per year on average between 2017 and 2022, according to a recent report by IBISWorld.
The report further points out that there are 190 Poultry Meat Processing businesses in Spain as of 2022, a decline of -0.2% from 2021.
The Poultry Meat Processing industry in Spain has a low market share concentration and the largest business is Grupo Sada, according to IBISWorld.
In 2021, Jordi Montfort, secretary-general of the country’s poultry producers’ association, Avianza, had warned the Spanish poultry sector was in a critical state and could face losses of more than EUR300 million (US$346.6 million).
These losses, according to Avianza, could arise from the double-digit input cost increases along with retailer price pressures.
Meanwhile, the global poultry market size is expected to grow to US$493.21 billion in 2026 at a CAGR of 8.9% from US$318.58 billion in 2021, according to the Business Research Company.
The poultry manufacturing growth is aided by stable economic growth forecasted in many developed and developing countries and emerging markets are expected to continue to grow slightly faster than the developed markets in the forecast period.
Liked this article? Subscribe to Food Business Africa News, our regular email newsletters with the latest news insights from Africa and the World’s food and agro-industry. SUBSCRIBE HERE.