Bank of Scotland has taken a £55 million (€82m) stake in Grampian Country Food Group, allowing the company to set up a poultry processing business in Thailand - according to a report in The Scotsman.Effectively, the bank provided the loan for Grampian's first international venture.
A statement from Grampian, market leader in pig and poultry supplies to the UK retail trade, said that the bank has subscribed in a new class of preference shares with some of the loan used to buy-in a number of passive institutional shareholders.
Fred Duncan, the chairman, founder and major shareholder in Grampian, which now employs about 21,000 people in more than 40 locations in the UK, Holland and Thailand, said:"The Bank of Scotland has been a strong supporter of ours for many years. This significant equity investment brings a new dimension to the relationship and gives us, we believe, the right financial partner for the future."
Grampian's turnover has continued to grow rapidly in the past year with two more substantial acquisitions supplying the added-value foods market - Malton Foods, Yorkshire, bought from Uniq , and the company's first international acquisition, Golden Foods International, a chicken processor in Thailand.
Grampian now supplies 3.8 million chickens a week to the UK market. The Thailand business. bought from Wessanen , produces, at present, 0.8 million birds a week to supply Far East and mainland European customers.
The main reason for the expansion into Thailand was lower labour costs and the company clearly believes that there is almost unlimited potential in poultry production there.
Chicken consumption in the UK continues to increase, with about 23 million bird-equivalents in all forms of portions, added-value and ready meals bought each week.
Of those, about nine million are now imported from countries including Thailand and Brazil. Breeding, rearing, feeding and housing costs are virtually the same anywhere in the world, but labour costs in developing countries are much lower.
A spokesman said that future investment will be focused on developing Grampian's product range.