August 22, 2011

Federal government clears Cargill & Teys beef joint venture

Cargill has been informed by the Foreign Investment Review Board (FIRB) that there are no objections in terms of Australia's Foreign Investment Policy to the joint venture between Cargill Beef Australia and Teys Bros.

This follows Australian Competition and Consumer Commission (ACCC) decision on July 6, 2011 not to oppose the joint venture.

Cargill Beef Australia Managing Director Andrew Macpherson said, "We welcome both the Federal Government's and ACCC's clearance of the joint venture between Cargill Beef Australia and Teys Bros."

Brad Teys, CEO of Teys Bros said, "We are pleased with the regulatory approvals as this joint venture ensures the new company has the depth and scale to provide growth opportunities for Australian cattle producers by driving efficiencies through all parts of the business and providing greater access to domestic and international markets."

"We look forward to concluding the transaction and focus on integrating the two businesses effectively and efficiently to ensure we create a world-class beef processing company that is firmly committed to the long term prosperity of the Australian cattle industry and our customers," said Teys.

"As previously stated, we are committed to keeping the current plants operating and the joint venture ensures we have the capacity to grow the business to the benefit of employees, Australian cattle producers and our customers," he said.

"The new company's success is directly linked to the success of the Australian cattle producers we work with and therefore we remain as committed as ever to building the new business and strengthening our global marketing reach to the benefit of all," said Andrew Macpherson, Managing Director, Cargill Beef Australia.

The new company will be a 50-50 joint venture and trade under the name of "Teys Australia - A Cargill Joint Venture".

Board representation will be shared equally by Cargill and Teys. Allan Teys will be chairman, and Brad Teys will serve as the chief executive officer in the new company. Geoff Teys will be responsible for cattle procurement. The company's head office will be located in Beenleigh, Queensland.

The new joint venture will include the assets of both companies' existing beef processing and cattle feeding businesses as well as Teys' tannery and value adding facilities, and Teys' share of its wholesale divisions. The joint venture will have the capacity to process 1.5 million head of cattle per year.