Smithfield Foods obtains regulatory approval to acquire Pini Polonia

By Jaroslaw Adamowski

- Last updated on GMT

The move was approved by Poland's Office of Competition and Consumer Protection
The move was approved by Poland's Office of Competition and Consumer Protection
US processor Smithfield Foods has obtained the permission of Poland’s Office of Competition and Consumer Protection (UOKiK) to take over local meat producer Pini Polonia Ltd.

Under Polish law, the competition 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 €1 billion worldwide, or €50m in the Polish market in the year that precedes the deal.

“Smithfield Foods is a global group that is active within the fields of meat production and processing. In Poland, [the group] controls, among others, Animex Group, it also owns nine meat production and processing plants, including three slaughterhouses,” ​the UOKiK said in a statement. “In this respect, it was necessary to perform market research. The UOKiK had to evaluate, among others, the market shares of the participants of the concentration and other companies that are active in this market.”

“An analysis of the implications of the concentration showed that it will not limit competition. Smithfield Foods will need to compete against other slaughterhouses [in Poland]. Due to this, there is no ground for concern that these entrepreneurs will lower the prices of livestock,”​ according to the watchdog.

The UOKiK also said that, in its opinion, the concentration will not affect the access of small- and medium-size market players to large retail chains.

The competition watchdog’s permission expires after two years if the authorised transaction is not completed within this period.

Long-term growth strategy

Andrzej Pawelczak, the PR director and spokesperson at Animex, told GlobalMeatNews​ that the acquisition demonstrates the long-term commitment to Poland by Smithfield which has invested nearly $1bn in the Polish market over the last twenty years.

Before the latest takeover, which concerns the company that operates a pig slaughterhouse in Kutno, in 2017, Smithfield moved to acquire local meat processing facility Pini Polska, cutting plant Hamburger Pini, and Royal Chicken, a company tasked with a greenfield investment in Kutno, from Italy’s Pini Group. The group owns facilities in Italy, Poland and Hungary, and it launched Pini Polonia’s slaughterhouse in April 2010. The facility’s range consists of various pig meat products. The slaughterhouse in Kutno is BRC- and IFS-certified, and it is fitted with 14 deboning lines enabled with a total capacity of some 16,000 head per day. This translates into about 4m head annually. 

In addition to its sales to other EU member states, the Polish slaughterhouse holds the required export licences to sell its products to more than 85 markets worldwide. These include the US, Canada, Chile, Hong Kong, Singapore, Ukraine, as well as a number of African countries, among others, according to data from Pini Polonia.

Located in Poland’s central region of Łódzkie, Kutno lies about 118 km from the country’s capital Warsaw.

Related topics: Financial, United States

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