The Linden Food Group is set to restructure its Slaney Foods business in the Republic of Ireland, resulting in the creation of a new partnership with ABP.
ABP have confirmed that they are set to take a 50% stake in Slaney Foods, which involves the purchase of the Allen family stake in the business.
The move has sparked serious concern among farm organisations in terms of both competition in the market and the concentration of the kill.
IFA National Livestock Chairman Henry Burns said competition in the beef and lamb trade is always a contentious issue between farmers and factories.
“Farmers are rightly concerned with the over dominance of a number of major players at both processing and retail level”.
Henry Burns said the investment will be subject to clearance by the Competition and Consumer Protection Commission, which needs to undertake a full investigation and provide the necessary guarantees and undertakings to farmers around competition and market concentration.
The companies have confirmed that an agreement in principle has been reached on the new partnership subject to approval by the relevant regulatory and competition authorities.
Slaney Foods is comprised of the Slaney Foods International beef business and the sheepmeat specialist Irish Country Meats (ICM).
It is currently jointly owned by the Allen Family and Linden Foods in Northern Ireland. As part of the reorganisation, the Allen Family will retire from the redmeat processing sector after more than 50 years to concentrate on their expanding wider business interests.
The Allen family shareholding will, in the first instance, be purchased by Slaney Foods.
The ABP Group will then invest in Slaney Foods to form a Joint Venture with Linden/Fane Valley. The new partnership will not impact on the day-to-day operations of either Slaney or ICM with business to continue as usual on all sites.
Trevor Lockhart, Chairman of Linden Foods said the Linden Food Group, like ABP, has over many years developed successful national, European and world market/customer positions, focussed on the retail and food service sectors.
“Exciting new opportunities are continuing to emerge across the globe and the challenge for us is to create the business models, with internationally competitive scale, capable of securing the best markets and commanding the highest return for our products.
“Our objective, extending back to our co-operative roots, is to maximise the value of our quality beef and lamb and to deliver competitive and sustainable returns to our farmer suppliers.”
Lockhart said the existing operational and management structure of the business will remain in place but now complimented with a shareholder with considerable market reach and processing expertise.
Meanwhile, Paul Finnerty, CEO of ABP Food Group said it is extremely pleased to have reached an agreement in principle with Linden Foods to partner them in the Slaney Foods business in the Republic of Ireland.
“At ABP we have a very successful track record with Joint Venture projects over many years and we have high hopes for this new partnership with Slaney Foods.
“The respective companies share the same ambition to grow and develop in what continues to be a very competitive market environment. This is a partnership that will benefit both parties and improve the range of products we offer in existing and new export markets.”