- This joint venture would help make New Zealand one of the top supplier of petfood proteins globally
- It will enable Alliance Group to become vertically integrated and establish end-to-end market connection
Leading processor of sheep meat, Alliance Group, has recently announced that the company would pay $15 million for a 50 percent stake in the Meateor petfood venture of Scales Corp.
Managing Director of agribusiness firm Scales Corp., Andy Borland, mentioned that the joint venture is all about making New Zealand as one of the top supplier of petfood proteins. It would also offer a number of advantages to the entire petfood supply industry of New Zealand.
Borland added that these advantages include an ability to leverage extended supplier and customer networks, an ability to shift into added value and higher value ingredients, enhanced relationships with customers including the capability of committing to long-term relationships, along with an avenue to the industry for improving scale.
David Surveyor, chief executive officer of Alliance Group, said in a statement that the joint venture extends the downstream reach of Alliance, enabling it to become vertically integrated, besides ensuring that the company has an end-to-end connection to the market.
Alliance is the largest exporter of sheep meat in the world, whereas Scales is a diversified agribusiness group.
Supposedly, the implied valuation for the New Zealand business of Meateor is $30 million and the settlement is scheduled to take place in this month. Borland further said that Meateor Foods provides processing and marketing of meat as well as other ingredients, from Australia and New Zealand to the pet food industry around the world. It exports over 19,000 tons per annum.
This major investment seems to come at a time when the global pet food industry is witnessing major growth. Surveyor stated that the global sales in this sector is anticipated to reach up to US$134 billion by 2022, and the company wants to ensure that the farmers of New Zealand are a part of this growth.