The joint venture, named SOHI Meat Solutions, follows a six-month co-operation agreement and will see it supply all Sonae Modelo Continente’s grocery stores and will increase Hilton’s presence to 15 countries around the world.
Under the terms of the 50/50 agreement, Hilton Food Group will help Sonae Modelo Continente to redevelop facilities at its packing and sourcing subsidiary Sonae Centro Processamento Carnes.
This redevelopment is expected to be completed by the end of the second quarter of 2017 and will involve an initial investment of €22m, financed principally by the SOHI partners. Hilton’s board expects the redeveloped facility to be “earnings enhanced” in 2017.
‘Exciting growth opportunity’
Robert Watson, Hilton Food Group CEO, said: “We are very pleased that this exciting growth opportunity has advanced to a joint venture with Sonae Modelo Continente. Our progress in Portugal demonstrates further the strength of Hilton’s flexible and versatile business model, enabling us to meet the local requirements of our customers in their territories. This now extends our presence to 15 countries, and we will continue to look for further opportunities for geographic expansion.”
Eunice Silva, Sonae Modelo Continente commercial director, added: “We are pleased that the partnership has progressed to a full joint venture agreement in Portugal, which will enable us to strengthen the leadership position of Continente further in the development of innovation and the sustainable promotion of the agri-food business in Portugal.”
SOHI at a glance
Hilton Food Group
- Set up in 1994
- Presence in 15 countries
- Saw a 21.3% growth in operating profit in the 28 weeks to 17 July 2016
- Recently expanded its Australian presence with the construction of a processing facility in Queensland
Sonae Modelo Continente
- Portugal’s leading food retailer
- 1,200 stores (including non-food and pharma)
- Founded in 1959
- Part of Sonae SGPS SA, which also has clothing, real estate and telecommunication divisions
- Retail arm of Sonae reported turnover of €993m in Q3 2016