FDBusiness.com

Hilton Food Group, the leading international specialist meat packing business, has signed a 50/50 joint venture agreement with Sonae Modelo Continente, Portugal’s leading food retailer, for the supply of a wide range of packaged beef, lamb, veal and pork products to Sonae stores in Portugal. This follows a period of approximately six months of co-operation.

Under the terms of the agreement, Hilton will work alongside Sonae to redevelop the production facilities of its packing and sourcing subsidiary Sonae Centro Processamento Carnes (CPC), which supplies Sonae stores in Portugal. CPC currently sources over 1,000 tonnes of packaged meat products per week. Products supplied from the plant will include mince, roasting joints and other beef and pork based products. The joint venture will be named SOHI Meat Solutions

The redevelopment of the production facility is expected to be completed by the end of the second quarter 2017. SOHI Meat Solutions will supply product to all Sonae’s grocery stores and the partners believe that the joint venture will be in a position to increase the overall volumes supplied to the Portuguese market.

The facility will require an initial investment of €22 million, financed principally by the joint venture partners. Hilton’s share of the investment will be financed primarily by debt. The Hilton board expects the new facility to be earnings enhancing in 2017.

Robert Watson, chief executive of Hilton Food Group, says: “We are very pleased that this exciting growth opportunity has advanced to a joint venture with Sonae Modelo Continente. Our progress in Portugal demonstrates further the strength of Hilton’s flexible and versatile business model, enabling us to meet the local requirements of our customers in their territories. This now extends our presence to 15 countries, and we will continue to look for further opportunities for geographic expansion.”