Ukrainian giant to take over Polish company

By Jaroslaw Adamowski

- Last updated on GMT

MHP has been expanding steadily across Europe as its export sales surge
MHP has been expanding steadily across Europe as its export sales surge

Related tags: Meat consumption, Meat

Ukraine’s grain and poultry giant MHP has submitted an application to Poland’s competition watchdog UOKiK to obtain the body’s approval for its plan to take over Polish poultry meat producer and processor KZD Exdrob. 

The transaction is to be carried out by the Cyprus-based Raftan Holding Ltd, a company that is part of the conglomerate, the competition watchdog said in a statement.

Foreign expansion plans

The potential acquisition of KZD Exdrob is to contribute to MHP’s ongoing efforts to increase its international presence. As previously reported, the rapidly increasing demand for white meat in Africa and the Middle East has been driving the Ukrainian group’s rising export sales​. In 2016, MHP opened a meat processing facility in the Netherlands​ and, last March, the company launched a new cutting facility in Slovakia. Outside Europe, MHP also operates a sales office in the United Arab Emirates.

MHP has been seeing decreased meat consumption in Ukraine. Following a period of robust growth, during which the country’s meat consumption per capita rose from some 43kg in 2006 to 56kg in 2013, Ukrainian meat consumption began to fall and, in 2016, it totalled 51kg, according to figures from the meat industry player. This negative trend has forced MHP to develop its export sales. In the first half of 2017, exports generated US$349 million (€293.6m) which translated into as much as 58% of the group’s revenues.

Regulatory approval for acquisition

The value of the potential takeover in Poland was not disclosed by MHP. However, it is noteworthy that the watchdog’s approval is prerequisite to finalising all acquisitions and mergers of Poland-based companies if the concerned entities posted total revenues of at least €1bn worldwide, or €50m in the Polish market in the year that precedes the deal.

KZD Exdrob is based in Kutno, in Poland’s central region of Łódzkie. The company’s history dates back to 1948 when a state-owned poultry slaughtering facility was established in Kutno. In 1992, the facilities were transformed into a company co-owned by its employees and 56 associated poultry breeders. In the following years, KZD Exdrob set up its chain of retail stores, and purchased two poultry farms in Staw and Kwilno, among others.

In addition to its meat production and processing facilities in Kutno, KZD Exdrob also operates in Płock, central Poland, after it took over local meat producer and processor Sadrob in 2011.

KZD Exdrob sells its output under the brands of Drobiusz, Drobiusz Premium and Drobuś. The company processes chicken, turkey, goose and duck meat, and its portfolio includes hams, sausages, pâtés and other processed meat products. KZD Exdrob says its facilities are ISO 9001-, IFS- and BRC-certified.

MHP is controlled by Ukrainian businessman Yuri Kosyuk who is one of the country’s wealthiest persons, with assets estimated at some US$1.2bn (€1bn), according to data from Forbes. Kosyuk set up MHP in 1998, and he also serves as the company’s chief executive

Related topics: Financial, Poland, Others, EU, Poultry

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