Polish meat business to invest €26m in new factory

By Jaroslaw Adamowski

- Last updated on GMT

Polish meat processor Agro-Rydzyna's investment will help it supply 1,000 supermarkets
Polish meat processor Agro-Rydzyna's investment will help it supply 1,000 supermarkets

Related tags: Stock market, Poland, Pork, Processing equipment & plant design

Polish meat business Agro-Rydzyna plans to invest PLN 110 million (€26 million) by 2020 to increase production at its Kłoda meat plant and build another processing facility in Poland

The company’s expansion plans are related to the development strategy of local supermarket chain Dino Polska, which owns Agro-Rydzyna. By the end of 2020, the retailer aims to exceed 1,200 outlets in the Polish market, according to Szymon Piduch, who serves as the president of the management board of both Agro-Rydzyna and Dino Polska.

Investment plans

Under the plan, the expansion of Agro-Rydzyna’s meat processing capacity in Kłoda will allow the plant to supply about 1,000 outlets run by Dino Polska. In addition to this, the company aims to build a second meat processing facility in Poland by the end of 2020, according to data from Dino Polska’s initial public offering (IPO) prospectus.

At the end of 2016, Dino Polska consisted of some 628 retail outlets, located in 12 of the country’s 16 regions. Last year, the retailer added 117 new stores to its chain, up from 101 outlets opened in 2015.

Set up in 1992, Agro-Rydzyna is based in Kłoda, in Poland’s western region. The company says its product range includes processed pork and poultry meat products, such as hams, bacon, sausages and frankfurters, as well as fresh pork and beef meat. Agro-Rydzyna launched production activities at its current plant in 2004.

Stock exchange debut

On 19 April 2017, Dino Polska debuted on the Warsaw Stock Exchange (WSE). Luxembourg-based entity Polish Sigma Group, part of the Polish Enterprise Fund VI which is managed by the Warsaw-based private equity firm Enterprise Investors, distributed its 48.04m shares, representing a 49% stake in the retailer. Of these, about 45.46m shares in Dino Polska were allocated to institutional investors, more than 2.4m shares to individual investors, and close to 182,000 shares to the company’s management. In total, the retailer’s IPO was valued at some PLN1.65bn (€390m).

The stock exchange debut was designed to allow Dino Polska to finance its planned investments in opening new stores and expanding Agro-Rydzyna’s facilities.

Dino Polska’s stores supermarkets are supplied by its three distribution centres, located in Krotoszyn, Piotrków Trybunalski and Jastrowie. By the end of 2018, the company plans to open a fourth distribution centre that will supply products to about 300-400 retail outlets. Under Dino Polska’s strategy, the chain is to gradually increase its presence in the country’s northern and eastern regions, where it is less active. In 2016, about 16% of the retailer’s sales revenues were generated by meat sales, according to the IPO prospectus.

Local businessman Tomasz Biernacki is the majority shareholder of Dino Polska, with a stake of 51%. Dino Polska posted revenues of some PLN3.37bn (€796.5m) in 2016, and is operated by a total workforce of more than 10,600 employees, according to data from the company.

Related topics: Meat

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