Scandi Standard takes control of Rokkedahl Foods

Nordic-based poultry firm, Scandi Standard AB, has agreed to subscribe for just over half of the shares of Rokkedahl Foods ApS of Denmark, which specializes in the production of organic and free-range chickens.

88studio | Bigstock.com
88studio | Bigstock.com

Through its Danish subsidiary, Danpo A/S, Scandi Standard will take on 51 percent of Rokkedahl Foods shares. The Rokkedahl family will retain control of the remaining 49 percent, including owning the firm’s poultry processing facility until at least 2023.

No material price will be paid for the shares in Rokkedahl Foods, but Danpo has agreed to guarantee some of Rokkedahl Foods’ interest-bearing debts and leasing obligations of around 56 million Danish krone (DKK; US$8.7 million at current exchange rates).

The investment, which is not subject to approval by regulatory authorities, is not expected to impact Scandi Standard’s net sales. However, it will give the firm access to a new processing plant designed for the processing of organic and free-range chickens, as well as speeding up the development of these premium markets in Denmark.

“Rokkedahl Foods carries out the sale of high welfare chickens under the brands Rokkedahl Kylling, Himmerland Kylling and Limfjordskylling,” said Leif Bergvall Hansen, CEO of Scandi Standard. “Rokkedahl Foods operates a brand new and modern slaughterhouse, which is ideally structured for processing of organic and free-range birds. Danpo will hence transfer all its existing processing of such chicken to Rokkedahl Foods following the investment.”

The Rokkedahl family began chicken production in 1963 at Kølby, which is just 25 kilometers from Danpo in Aars. Later, it set up Rokkedahl Landbrug, which supplies live chickens to a number of processors including Rokkedahl Foods as well as certain other businesses.

Under the agreement, Danpo will be granted an option to acquire the remaining 49 percent of the business from the Rokkedahl family in 2023 for six times the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA).

According to the firm’s own web site, Scandi Standard was formed in 2013 with the aim to create the leading group for chicken-based products in the Nordic region. Based in Sweden, it now has operations also in Denmark, Norway, Finland, and Ireland. Annual turnover is around SEK7.5 billion (US$824 million at current exchange rates), and 3,000 employees.

Just last month, Scandi Standard announced a 39 percent increase in sales for the second quarter of the year compared with the same period of 2017.

The firm commented that net sales were up in each country in which it operates, but the main factor contributing to increased sales was the acquisition of poultry processor Manor Farm of Ireland in August of 2017.

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