BANGKOK -- Charoen Pokphand Foods, an agribusiness conglomerate owned by billionaire Dhanin Chearavanont, announced Monday it would acquire U.K.-based poultry company Westbridge Food Group, as it takes another step into the European market.
CP Foods has agreed to buy all the shares of Westbridge Food Group whose enterprise value is 60 million pounds ($74.9 million) including debt of 7 million pounds. The transaction is expected to be completed by the end of April.
Westbridge has more than 100 subsidiaries that have import licenses for poultry in European countries such as the Netherlands. CP Foods aims to use this quota to expand its poultry exports into the European markets from Thailand directly. By doing so, it is believed that the company will bypass any effect of Brexit, or the British vote to leave the European Union. The company also operates a re-packaging plant in the U.K. which will add to CP Foods' production capacity there.
The U.K. will leave the EU by March 2019 and it is yet uncertain what access it will have to the single market in terms of trade after the divorce.
CP Foods already sells and manufactures processed foods such as microwavable snack brand Taste Inc. in Europe and operates Asian fast-food restaurant chain Chozen Noodles.
Chairman Adirek Sripratak said in a statement that CP Foods will be able to "expand its distribution network for retail, food services and food manufacturers in the U.K. and the EU countries." He added that most of Westbridge's markets are "new customer groups" for CP Foods.
Although CP Foods' focus had long been in Asian markets such as Thailand and China, the company has recently been reaching out into developed markets, such as Europe and the U.S., where consumers have higher purchasing power.
In January, it announced it would acquire a 33% stake in Polish chicken processer SuperDrob Capital Group for 49.5 million euros ($52.8 million). The deal marked the company's first investment in poultry operations in Europe. In December, it completed a $1.075 billion acquisition of U.S. frozen foods maker Bellisio Parent.
CP Foods is targeting to generate 75% of its sales from international operations by 2020. In 2016, that ratio was around 68%, a marginal increase from 66% a year ago.