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Brazil's Sadia Meatpacker Buys So Frango Poultry Firm

by 5m Editor
23 December 2004, at 12:00am

BRAZIL - Brazilian poultry and pork firm Sadia SA (SDA) announced on Wednesday its purchase of regional Brazilian poultry company So Frango Produtos as part of a strategy to expand Sadia's domestic market leadership.

Sadia said the purchase price was $26.5 million for a 100% stake in So Frangos, which operates in central Brazil.

Sadia said So Frango currently slaughters 150,000 chickens per day. Sadia intends to develop So Frango's production capacity to reach 400,000 per day, Sadia said in a statement.

With the purchase of So Frango, Sadia now owns 14% of Brazilian chicken production, broadening its market leadership. The company said half of So Frango's production will go to exports and half to the domestic market.

Sadia's business is booming thanks to a surge in exports of Brazilian meats, especially chicken. Like other Brazilian producers, demand for its produce has been boosted by outbreaks of Avian flu across Asia, which curtailed exports of Asian poultry and boosted chicken prices globally.

Also, a growing Brazilian economy can drive up domestic sales. Brazil's economic growth is expected to increase by more than 5.0% in 2004 and by at least 3.5% in 2005, according to economists.

Source: eFeedLink - 23rd December 2004

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