Poultry International - June 2018 - 24
24 ❙ PoultryInternational
NEWLY FORMED AVARA TAKES THIRD SPOT IN UK POULTRY SECTOR
is the new company's chief executive, while fresh chicken
director with Cargill Meats Europe Chris Hall is Avara's
chief commercial officer.
Cargill UK's poultry plant expands
Commenting on the creation of the new company,
Dawkins said: "Launching Avara Foods brings together two
successful businesses with high standards, shared values
and strong reputations for building sustainable partnerships
with customers, growers and suppliers. Our first step is
to make sure that there is a smooth transition as we bring
together the two businesses as Avara Foods, and establish a
solid platform for growth."
Building on investments
Over the past five years, the two companies have invested
significantly through their respective supply chains, with a
combined value of GBP75 million (US$107 million) on processing infrastructure. Now, forming Avara is seen as being
the best way to expand growth in the local market, drawing
on the two partners' complementary customers and offerings.
Dawkins said: "If you look at how the retail sector has
consolidated in recent years, and how this has been matched
by the supply side, now is an obvious time to bring together
two high-performing and well-regarded businesses."
For Faccenda, the joint venture is the latest in a series
of changes over recent years. The family-owned company,
which reported sales of GBP523 million (US$735 million)
last year, started as a single chicken farm in 1962 and has
grown into a major U.K. food business.
In 2012, it bought the turkey producer Cranberry Foods
and in 2015 added duck to its portfolio through the acquisition of Cherry Valley Foods, making it the country's only
supplier of chicken, duck and turkey.
Similarly, Cargill has been making significant investments in its U.K. poultry business, including expanding its
processing facilities and its base of growers.
In late 2013, the company announced a GBP35 million
(US$50 million) expansion and modernization program,
which included capacity expansion and the modernization
and upgrading of facilities. Most investment was concentrated at its Hereford site and focused on creating "one of the
most efficient and competitive processing plants in Europe."
Growth, not savings
The new company is about growth, Dawkins said, not
cost savings, with Avara Foods bringing together two successful businesses with high standards, shared values and
strong reputations for building sustainable partnerships with
customers, growers and suppliers.
"Our aim as Avara Foods is to grow - there's no doubt
about that. But our focus right now is ensuring that high standards are not missed - be it quality, delivery or customer service. Over time, we will integrate the businesses further and
learn from each other. That process has already started and
it's exciting to see what it leads to," Dawkins said. "Internally,
if we can establish a culture that all our people relate to and
feel part of, then we'll have overcome the single biggest challenge in integrating any two businesses. What's been great so
far is that, culturally, we are already closely aligned."
The new company has a particularly strong position in
fresh and added-value product supplied to retail, with a 20
to 30 percent market share, and holds a similar position for
these product categories supplied to the catering market.
Where its relationship with growers is concerned, there
is a belief that the merged business will provide stability and
security for growers for years to come, and the strong relationship with the growing community will be built upon.
It is a stand-alone business, and outside of the new joint
venture, Cargill is continuing to process and sell cooked
poultry products as well as operate its poultry import, trading
and distribution business, along with its European poultry
businesses in France, Russia and the Netherlands. Faccenda
has retained its shareholding in Dartmouth Foods, entered
into in 2016 for cooked poultry products.
Plans to merge the two businesses into Avara were first
announced in late September 2017 and approved by the
U.K.'s Competition and Markets Authority in December. ■
www.WATTAgNet.com ❙ June 2018