As recent national livestock figures show sheep and cattle numbers falling, and the continued swing to dairy evident in the south, today's SFF announcement closing the lamb cutting plant at Belfast and rendering business comes as no surprise.
With a goal to streamline their business in accordance with the size of the market, some rationalisation by the biggest meat processor was inevitable. They have worked very hard at succesfully reducing their debt in the last year, but sheep numbers have continued to fall at the same time, cancelling some of the gains.
Talleys have moved for further control of their 53% stake in AFFCO, planning to buy out the Spencer family interests, and expand its share in this company to 76%. It is still unclear whether Talleys goal is to raise its stake in the company and expand its meat interests, or through the AFFCO interest in Dairy Trust, widen its dairy investment.
NZX-listed meat processor Affco is the target of a full takeover bid by its largest shareholder, Talley's Group, which has agreed to buy out the next-biggest investor, raising its stake to 76 per cent, reports The NZ Herald.
Talley's, which owned 53 per cent has reached an agreement to buy out the Spencer family's Toocooya Nominees. It is now required by New Zealand takeovers law to make an offer to all shareholders. Talley's has indicated it plans to offer 37c a share, the same price agreed with Toocooya, valuing Affco at $187 million.
Silver Fern Farms has today announced proposals to close its Canterbury lamb cutting plant, and to close the rendering and casings departments and restructure the coldstore department at its Belfast plant. Silver Fern Farms’ Chief Executive Keith Cooper said the proposed closures were a result of Silver Fern Farms’continued focus on streamlining business operations and optimising efficiencies across its various processing sites in the South Island.
The red meat industry is suffering from the threat of alternative land uses, processing overcapacity, weak processor profitability and low farmer returns.“This means integrating our operations where possible so that the majority of our product is slaughtered, cut and packed at the same plant to attain the highest standards of food hygiene and safety and minimise our environmental impact” said Mr Cooper.
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