Danish Crown to take on Tican
Tican has been on the look out for a partner for some time, and the deal not only secures a future for the company "but 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," he continued.
The agreement between the companies has been reached after consulting with both Danish and foreign competition experts, said Danish Crown.
According to a statement by Danish Crown, both businesses generate the majority of their revenue outside Denmark, as well as outside the EU, and will still be a small player on the European market, even after the merger.
Tican has 277 members and employs around 2,200 employees. It slaughtered 1.9m pigs in 2013/14, and posted revenue of DKK5.2 billion. This compares to Danish Crown, which reported revenue of DKK58bn in 2013/14, has 8,278 members and employs around 26,000 staff, slaughtering 22m pigs in 2013/14.
Erik Bredholt, chairman of Danish Crown’s board of directors, commented: "Danish Crown is the result of mergers and acquisitions over the decades. 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."
Ove Thejls, chief executive at Tican, added: "It will be months before the competition authorities give their approval and, during this period, nothing will obviously change – neither for our employees nor for our members. We will spend the next few months getting to know each other’s companies through in-depth analyses to ensure the best possible outcome of a merger."
The merger is conditional upon approval by an extraordinary general meeting by the boards of both companies, and by the relevant competition authorities.