Kilcoy’s strategic US investment in value-adding operations

Jon Condon, 16/12/2014

THE parent company behind dedicated grainfed beef processor, Kilcoy Pastoral Co, has made an important strategic investment in a large and highly successful value-adding business in the United States.

kilcoy-brandChinese-based New Hope Investment Fund, which took a controlling interest in southern Queensland’s Kilcoy Pastoral Co in December last year, has completed its acquisition of Ruprecht Co, based in Chicago.

Established in 1860, value-added animal protein producer Ruprecht Co is the oldest operating beef processor in the Chicago area.

With a turnover said to be in the hundreds of millions of dollars each year, Ruprecht has a stable of well-known brands servicing the retail and food service segments in the US, as well as exports into the Middle East, Asia, South America and the European Union.

The company has invested heavily in research and development in the past ten years, expanding its offer to fully-cooked meal solutions, side dishes, and value-add raw items. Major customers include prominent US retail supermarket chains, plus well-known independent local and national restaurant chains. The company has separate operations for raw processing, cooking operations and cold storage/distribution.

Ruprechts value-added

Ruprecht has pushed heavily into growing the fully-cooked sector of its business, including sous vide products, building a first-class cooking facility features tumbling, searing, packaging and steam oven technology to suit customers’ unique and varied needs.

The company uses a variety of proteins including beef, veal, lamb and chicken.

Kilcoy has grown to become one of the largest beef processors in Australia, processing more than 260,000 grainfed cattle each year and exporting premium beef to more than 20 countries worldwide under the distinctive Kilcoy ‘Blue Diamond’ and ‘Kilcoy Pure’ brands.

The US investment by New Hope follows a recent trend being seen among global processors towards building exposure at the value-added end of the beef supply chain.

JBS, for example, has recently made a string of value-added company acquisitions, both within Australia and overseas. Other Australian processors including Teys Australia and Thomas Foods International are also increasing their exposure in the value-added space, attracted by potentially larger margins than for raw meat.

Dean Goode

Dean Goode

Kilcoy Pastoral Co chief executive Dean Goode said acquiring and integrating a leading value-added protein producer was a critical step towards positioning the Kilcoy Group towards becoming a significant global protein company.

“Ruprecht’s position in the US market as a leading producer of value-added protein products very much complements KPC’s business model,” Mr Goode said.

“This acquisition will provide our group with superior supply chain integration and advanced market positioning. It clearly demonstrates the strong commitment from our shareholder to strategically grow our business into a market leader in the beef industry, while also contributing further to the globalisation of the Australian beef industry.”

Mr Goode told Beef Central that the US was already a major customer country for Kilcoy’s export programs, and the move would only serve to strengthen that supply relationship. While Ruprecht also processed a little grassfed and organic beef product, mostly out of Uruguay, the investment would not change Kilcoy’s sole focus on producing high quality grainfed beef.

“In fact it strengthens that grainfed relationship that we have with our feedlot suppliers. It gives them greater confidence in the business model that Kilcoy is developing,” he said.

“We’re developing a model that’s about further strengthening our 100-day grainfed programs. It’s a reinforcement of what we already do.”

“We believe that this expansion will further benefit our suppliers, our customers and our employees,” said Alex Zhang, chairman of KPC Group.

  • New Hope Investment Fund, a private equity fund managed by Hosen Capital, focuses on agriculture and food industries. The fund has a global investor base, including investors from the US, Singapore, Japan and China. Its Chinese anchor investor, New Hope Group, is China’s largest animal feed producer and one of the largest animal protein suppliers.




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