October 25, 2013

Karro Food plans to expand pig farming operation

Karro Food Group, a company created by the management buyout of Vion Food Group's former pork business in the UK, has signalled plans to expand its Aberdeenshire pig farming operation.

The company which supplies fresh pork, cooked and cured cooked meats to retail and catering customers, came into being as Vion's exit from the UK led to the closure of the Hall's of Broxburn plant in December.

Chief executive Seamus Carr, who joined Vion from Grampian Country Foods in 2008, shortly before it was acquired by the Dutch company, led the buyout with other senior managers, backed by Leeds-based private equity firm Endless LLP. The deal brought Karro's two slaughterhouses in Northern Ireland and Yorkshire, which slaughter a combined 41,000 pigs per week, as well as one in Somerset it has since closed.

Karro, which has processing plants in Scunthorpe, Hull, Suffolk and Stoke, and an in-store butchery business, also inherited from Vion a pig farming business in Brydock, Aberdeenshire, where it employs 100 staff and plans to ramp up capacity from its current 8,500 sows to 10,500. It said that the £2 million (US$3.2 million) investment would see it expand output from 3,500 to 4,500 pigs per week.

Carr said Karro, which secured a £60 million (US$97 million) investment from GE Capital after refinancing this year, said Endless remained committed to the firm for the "medium term at least".

Noting Endless has committed to providing "additional funding as and when required", on top of the "substantial investment" it has already made, he said Karro was a "well-financed, well-structured" business with a supportive private equity backer.