July 27, 2011

 

South Korea's Harim to acquire US poultry producer for US$120 million

 

 

South Korea's chicken meat producer Harim reported on July 26 that it managed to acquire US poultry producer Allen Family Foods, beating out rival Omtron Ltd.

 

The acquirement would cost Harim US$120 million. Under a plan, Harim will buy the asset of the bankrupt Seaford-based poultry producer and acquire chicken and feed stocks after due diligence.

 

Allen Family Foods, the world's 19th largest poultry producer, filed for Chapter 11 bankruptcy protection in Delaware court last month.

 

Allen, a 92-year-old business with US$45.3 million in sales, last year blamed its downfall on surging corn prices, operational miscues and a credit crunch that led one of its largest lenders, Wilmington Trust, to slash its line of credit by nearly 90%. Its annual production capacity represents half of Korea's annual consumption.

 

With the acquisition, Harim has become Korea's first poultry producer to foray into the US market.

 

Formal acquisition will be determined at the court on July 27.

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