MHP Eyes Doux Takeover to Boost Poultry Production in EU
The Kiev, Ukraine-headquartered MHP agribusiness group is reportedly in discussions to acquire Groupe Doux, a major poultry producer based in Chateaulin, Finistere, France. With 1,200 people on its payroll, Doux is controlled by French agricultural cooperative Terrena, which owns a majority of its shares.
MHP ranks as the poultry-processing leader in Ukraine, accounting for 35% of total chicken meat consumption and over 55% of industrial produced poultry in the home market. It earned profits of $230 million on sales of $1.28 billion last year, of which $732 million was realized from sales abroad. Export volume weighed in at 221,000 tons of poultry, largely going to Europe, the Middle East and North Africa. Outside of Ukraine, the company has factories in the Netherlands and Slovakia, and is said to be in negotiations to acquire additional production capacity in the United Kingdom and Germany.
Meanwhile, a Doux spokesman has declined to confirm a report in the French press that a March 31 deadline of sorts is looming, as Terrena may cut off funding loss-making Doux at that point. All parties are mum at the moment, including the French government, which will likely be asked to provide financial incentives to make a takeover possible and thus preserve jobs.
According to a UNIAN Information Agency dispatch quoting a Terrena spokesman, Doux has lost approximately €35 million in each of the past two years and needs an investment infusion of at least €100 million to modernize plants and reorganize its operation. The company filed for bankruptcy in 2012 after losing EU export subsidies. The focus now includes plans to develop more upscale products for the European market as well as halal products for distribution on the continent.
Confronting stiff competition from Brazilian exporters in the Gulf states and other Middle East markets, it has joined with Saudi partner Al Munajem Cold Stores Co. to target the healthy eating sector in that part of the world. Doux Fitlife frozen chicken was recently introduced in the Kingdom of Saudi Arabia (KSA) following two years of research and development. Containing 10% less fat than other poultry products on the market, it features chicken fed with flax seeds, a natural source of Omega 3.
Saudi Arabia is the world’s leading importer of whole frozen chickens. Per capita consumption of poultry amounts to around 45 kilograms per annum, and four out of 10 whole frozen chickens purchased in the Kingdom are Doux brand products.