ONE of China’s largest meat processors is in advanced negotiations to take a strategic stake in large Australian beef processor, Bindaree Beef.
Bindaree’s group financial officer, James Roger, confirmed details published in the Financial Review this morning to Beef Central a few minutes ago.
Shandong Delisi Food Co has a market capitalisation of about $1 billion and is listed on China’s Shenzhen Stock Exchange. The company’s shares have been suspended pending the outcome of the talks.
Bindaree is Australia’s fifth largest beef processor, now becoming increasingly vertically integrated following its recent merger with marketing and distribution company Sanger and the purchase of the 20,000 head Myola feedlot near North Start on northern NSW.
The company operates a single-species export beef plant near Inverell in Northern NSW, with daily throughput of 1300 head, and employing about 600 local staff. During the past three years, the company has developed a series of grass and grainfed premium beef brand programs.
The company earlier this year flagged a global search for a strategic investment partner, and some saw the recent mergers and acquisitions as part of that process.
In January Bindaree Beef said it was seeking a strategic investor to make a $100 million cash injection into the business in an effort to increase its processing capacity and enable it to enter new export markets.
Processor contacts attending today’s Meat Industry Conference on the Gold Coast suggested Shandong Delisi’s proposed stake in Bindaree might be 20 percent.
Shandong Delisi’s strong distribution channels could enable Bindaree to become a premium beef supplier to China.
Bindaree last year announced plans to expand its marketing operations in China via a shelf-ready program.
Beef Central expects to see more details on the Shandong Delisi investment next week.