CampofrAÂo, Spain’s leading meat processor, on Friday announced a cash-and-share plan to absorb privately-owned rival Navidul, in an operation the two companies valued at E300m (283 million dollars).
The merger will bring together Spain’s number one and number three meat products companies to form one of Europe’s largest groups in the sector, with combined annual turnover of about E1.5bn, 10,000 employees and a domestic market share amounting to 22 percent.
Pedro Ballvé, CampofrAÂo chairman, said he expected the merger to lead to further consolidation in the fragmented Spanish food sector.
The deal follows CampofrAÂo’s recently-completed purchase of 87 percent control of another listed Spanish company in the sector, Oscar Mayer (Omsa), for E77 million.
Juan José Guibelalde, chief executive, said he did not expect the Navidul deal to meet any problems on competition grounds. The Omsa takeover received tacit approval by the Spanish authorities last month.
The CampofrAÂo group also includes the Portuguese leader Fricarnes, taken over last year for about E50m, and subsidiaries in Russia, Poland and France.
The deal with Navidul, which leads Spain’s cured ham market, will give Navidul’s main shareholders, the DAÂaz family, a 16 percent stake in the joint group. Mr Ballvé’s family will control 45 percent, Hormel Foods of the US about 18 percent, with the remainder traded on the market.
Luis Serrano, Navidul chairman, will join Mr Ballvé as co-chairman of the merged group for the next three years. Chase Manhattan advised both sides on the deal.
CampofrAÂo shares, which were suspended for part of yesterday after rising 9 percent, climbed further following the announcement to close 15 percent up at E12.36. Reuters