SOUTH Australian-based meat processor Thomas Foods International has bought a 50 percent stake in Victoria smallstock operator Frew Group.
The two family-owned businesses said today they will join forces under a new corporate structure from 1 July, to grow national and global markets for high quality Australian meat.
They said the formal partnership would provide second generation livestock and meat processing sons, TFI chief executive Darren Thomas and Frew Group managing director Robert Frew with a unique opportunity to build further on the platforms created by their respective fathers Chris Thomas and Arch Frew.
Under the arrangement, the Frew Group will be renamed Frew International. Both companies will continue to operate independently, with Mr Frew as managing director of Frew International and Mr Thomas joining its board as executive chairman to help guide global growth and future strategy.
“Today’s announcement strengthens our companies’ high quality ‘farmgate to plate’ offering for consumers right across the globe,” Mr Frew said.
Mr Thomas said the investment into Frew provided great benefits to both companies over the long-term and in particular to Frew’s longstanding livestock suppliers and customers.
Mr Frew said the development would be good for local employment and to lift the sheep and lamb numbers through his Stawell plant, but would not mean any repurposing for beef processing.
“I’m pretty sure this will remain as lamb plant here, it’s a good area for lambs, more so than cattle.”
He expected the partnership would increase his plant’s export lamb processing.
“It makes sense not to transport lambs too far so if they buy lambs in this area they will come here.
“They buy a lot of lambs in this area, it makes it smarter to process them in this area,” he said.
He believed TFI intended to only process beef at its new Murray Bridge plant, set to be built on a greenfield site after the former abattoir burnt down in January 2018.
Frew’s Stawell plant is currently killing about 4500 lambs a day four days a week, but has the capacity to process more than 6000 lambs, sheep and goats a day, employing about 420 people now, or about 500 at full production. The company’s business is divided between domestic and export lamb processing, including contract killing for Woolworths and supplying Aldi.
With COVID-19 impacts, the company is processing what it can sell, but has plans to build an extra chiller at Stawell, although Mr Frew was not sure what upgrades would happen with the new partnership. The Tier II accredited plant has been approved for China, but its listing has not come through, Mr Frew said. The Frew meat processing company was established by Mr Frew’s father the late Arch Frew in 1984.
TFI owns meat processing plants in Tamworth and Lobethal along with the soon-to-be rebuilt Murray Bridge plant as well as leading national domestic wholesale, foods service and export business Holco. TFI exports across the globe with subsidiary companies located in Asia, Europe and the United States, where it operates a state-of-the-art value adding, retail, foodservice and storage facility in Swedesboro, New Jersey.
Aussie companies investing in each other
Mr Thomas said both companies have had a mutual respect for each other over many years.
“We are both family owned and family grown which means a lot in our industry, particularly to our customers and livestock suppliers.
“For us, it was important to partner with a company that has a similar focus on quality and running a business based on strong family values,” he said.
“This investment is not only aimed at helping facilitate Frew’s exciting growth prospects but also enhancing TFI’s offering across the meat industry including some of Frew’s existing key markets that TFI has not served in recent years.”
Mr Frew said it had always been his preference to work with Australian-owned companies and support local communities.
“I think there are too many of us being bought out and the money leaves these shores unfortunately, so we need to balance up the trade deficit in some way.”
Mr Frew said he was excited with the partnership and can only see benefits to the company’s customer relationships, commitment to service, quality, team and community under the new Frew International banner.
“Our well-established and focused national retail domestic customer relationships and export markets, in particular the Middle East, will benefit substantially through combining our increased procurement, supply chain, access to markets and processing volumes.
“Our two companies had already established a great working partnership, with Holco purchasing products from our company over many years,” he said.
“Whilst ever the offering size can be matched to the current demand, this market has a chance of arresting the slide, as was evident this week.”