Cherkizovo’s acquisition of Cargill poultry plant closes

Cherkizovo Group closed on the acquisition of a chicken processing plant in Efremov, in Russia’s Tula oblast, from Cargill.

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Cherkizovo Group closed on the acquisition of a chicken processing plant in Efremov, in Russia’s Tula oblast, from Cargill.

Cherkizovo in July announced it had signed a preliminary agreement with Cargill to purchase the facility, and in a press release issued on September 21, stated that the transaction has been completed, following the approval of the Russian Federal Antimonopoly Service. Terms of the agreement were not released.

The newly-acquired plant has the capacity to process about 20,000 metric tons of chicken nuggets and other poultry products annually. The majority of the products processed at the plant are sold to McDonald’s. With the new plant, Cherkizovo is expected to greatly increase its service to the foodservice industry.

“We are happy that the deal was closed on time, thanks to (the) great efforts and professionalism of the Cherkizovo and Cargill teams,” Sergey Mikhailov, CEO of Cherkizovo Group, said in a press release. “We believe that the new asset will be integrated into the group in a matter of months. I am confident that the experience and expertise of the newly acquired team will bring in additional HoReCa (hotel, restaurant and catering) competencies, which we seek to expand as one of our top priorities.”

“McDonald’s has been consistently expanding its network of domestic suppliers. 99% of our products are sourced locally. We are happy to see Cherkizovo Group embracing additional opportunities through our partnership. This integration will foster further market development,” added Sergey Kapkov, senior purchasing and logistics manager, McDonald’s.

Cargill officially opened the chicken processing facility in Efremov in 2013. This $40 million facility was Cargill's first primary chicken processing operation in Russia.

Presently, Cherkizovo Group is the largest poultry company in Russia, the third largest in Europe and 16th largest in the world, according to the Poultry International Top Companies rankings. In 2018, the company slaughtered 397 million broilers. Cargill, headquartered in the United States but with operations in multiple countries, ranks as the 12 largest broiler company in the world, having slaughtered 557 million broilers in 2018.

Both Cherikizovo and Cargill are diversified agrifood companies, with a presence in the poultry, pork, and feed and grain industries.

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