JAKARTA -- Indofood Sukses Makmur's planned joint venture with Brazilian poultry giant BRF has been scrapped due to differences in strategy, the head of Indonesia's largest food company confirmed Friday.
"BRF is already gone because they said they have different thinking," Anthoni Salim, Indofood's president and chief executive told reporters in an annual press conference. The partnership, initially announced in December 2014, included plans to set up a 50-50 joint venture company in Indonesia in the poultry sector, and invest $200 million.
BRF did not respond to requests for comment.
Anthoni said Indofood, the world's biggest instant-noodle producer, is still committed to entering the domestic poultry industry amid expectations that protein consumption will increase along with population and income levels. "We already promised to the shareholders that we are going be involved in the protein side of the equation," he said.
He added that Indofood is looking to tap the technology of Malaysian poultry company CAB Cakaran, which in 2015 agreed to set up a joint venture with one of Anthoni's Singapore-based investment companies. "I think we will be able to share news sooner than you think," he said, declining to elaborate further.
Indonesia's chicken market is currently dominated by a handful of large players. Anthoni said Indofood intends to develop an integrated business to provide competitive pricing, a strategy that will put the company in direct competition with the top player, Thai conglomerate Charoen Pokphand Group. "The pricing must be competitive to have a far-reaching impact to the population," he said. "We have to integrate the total ... corn production, soybean, feed, [day-old chick] production. Hopefully we can participate in this challenge."
Anthoni leads the Salim Group conglomerate, which also has interests in infrastructure, cars and finance mainly across Indonesia and the Philippines. Indofood is the group's core company.