April 18, 2007

Cherkizovo's acquisition makes it the largest poultry firm in Russia

Cherkizovo will become Russia's biggest chicken producer after acquiring rival Chicken Kingdom, the company said on Tuesday (Apr 16). 

Meat firm Cherkizovo, which raised US$250 million listing shares in London last year, said in a statement it had signed a memorandum with a view to purchasing Chicken Kingdom.

However, it did not reveal when the deal would be concluded or how much it is paying.

The deal would not only make Cherkizovo the largest chicken producer in Russia but would also strengthen the company's position in the central region of the European part of Russia, Cherkizovo CEO Sergei Mikhaikov said.

Moving to cut the country's reliance on chicken imports, which comes mainly from the US, Russia has made animal breeding one of its priority projects for growth.

Domestic production last year accounted for just over half of the country's poultry meat consumption. However, domestic poultry meat output is expected to rise 16 percent this year.

Cherkizovo has a current market capitalisation of US$674.5 million and runs eight meat processing plants, two poultry farms and four pig farms.

It also owns a poultry processing factory and a feed production plant.