07 September 1998
Abattoirs to merge as pig crisis hits Danes

DENMARKS two largest co-operative abattoirs plan to merge to form the largest meat-processing business in Europe.

Danish Crown (DC) and Vestijshe Slagterierer (VJS) are both farmer-owned and together process about 15.5 million pigs, some 80% of Denmarks total production.

The combined group will be more than twice the size of UK rival Unigate Malton-Halton. Turnover of the new group will be about Dkr37 billion (£3.35bn) and it will employ about 18,000 people.

The deal is expected to require permission from the European Commission on competition grounds.

Producers received an average of Dkr11.60/kg (£1.05/kg) for pigmeat in 1997, but prices have now slumped to Dkr7.10/kg (64p/kg). Asian demand has weakened and Russias orders have dried up altogether. Rising US pig production has added to the sectors woes.

Niels Mikkelsen, incoming chairman of the new group, said: “It is crucial that we can maintain the offensive role which the Danish meat industry already plays in the world market”.