The transaction was valued at RUB4.5 billion (US$70 million), and it concluded following approval of the Russian Federal Antimonopoly Service. Cherkizovo announced its intent to acquire the poultry producer, based in the Altai Territory, in the summer of 2018.
Altaisky Broiler is one of the leading players in the Siberian poultry market with an annual output of 67 thousand metric tons (live weight) of poultry products (58 thousand metric tons of finished products), according to a press release from the company. The acquisition will enable Cherkizovo to access the Siberian Federal District market and strengthen its market-leading position in the domestic poultry market.
“We see plenty of opportunities for our development in Siberia. Nationwide retail chains are actively expanding in the region, and we are determined to match their growth,” said Sergey Mikhailov, CEO of Cherkizovo, adding that the group was mainly interested in moving into the region’s major cities.
In order to supply the Altai producer, and cover the group’s self-sufficiency in hatching eggs supply, Cherkizovo also acquired production facilities of the Krasnoyaruzhsky Broiler (Belgorod Region) from Prioskolie along with the parent stock.
The company plans to use Altaisky Broiler as the foundation for its distribution system in the Siberian Federal District, selling chicken products under Altaisky Broiler, Petelinka and Chicken Kingdom brands. The group also intends to increase its processed meat supplies to Siberia.
The No. 1 poultry producer in the Altai Territory, Altaisky Broiler is also among the largest poultry producing companies in the Siberian Federal District. Established in 2007, Altaisky Broiler delivered its first products to the market in December 2008 Today, it is a state-of-the-art poultry production facility comprising a hatchery, a feed mill, four fattening sites, a slaughterhouse, and a meat packing plant in Biysk. Chickens are raised on a well-balanced diet of compound feeds produced in-house. Altaisky Broiler offers around 100 chilled and frozen poultry products.
Eversheds Sutherland acted as legal advisor for Cherkizovo, advising on due diligence and the crafting of agreements.