Denmark's largest pork processors to merge
Feb. 24, 2015
by Erica Shaffer
RANDERS, Denmark – Tican, Denmark's second-largest meat processor, was looking for a business partner and found one in Danish Crown. The two companies announced plans to form a joint company.
Danish Crown approached Tican more than a year ago with idea of merging the companies. Tican and Danish Crown have an international footprint that generates most of the companies' revenue outside Denmark. However, the merged company will remain a small player in the European market.
“With this solution, we have found a model that not only secures a future for Tican, but which also ensures that our owners – Danish farmers – can continue to contribute to value creation in the Danish food cluster,” said Jens Jørgen Henriksen, chairman of Tican’s board of directors. “Originally, we never expected Danish Crown to be a potential partner, but this merger is undoubtedly the preferred solution for Tican’s cooperative members.”
Ove Thejls, CEO of Tican, said the companies will spend the next few months familiarizing themselves with each other's operations while government competition authorities review the merger. If the merger is approved, Tican’s members will join the new company on an equal footing with Danish Crown’s members. Both parties expect differences in equity and earnings between the two companies will be evened out within two years.
“Danish Crown is the result of mergers and acquisitions over the decades,” said Erik Bredholt, chairman of Danish Crown’s board of directors. “Common to them all is that they have been very important for Danish Crown’s strategic position in the international slaughterhouse industry, which has seen extensive consolidation.
“However, that is not the case with this merger. We therefore needed to ascertain whether the competition aspects would actually make a merger possible. And now we have received a clear indication that it is possible.”
Tican reported revenues of DKK 5.2 billion for the 2013-2014 fiscal year. The company employs 2,200 workers and has 277 members in its cooperative. The company slaughtered 1.9 million pigs during the 2013-2014 fiscal year. Tican was founded in 1931 and has headquarters in Thisted in north-west Jutland. The company’s products include fresh and frozen pork, bacon, ready meals as well as a number of other processed meat products. Tican owns processing companies in Denmark, the United Kingdom and Poland.