Analysis Insights
Danish Crown cuts in German meat processing
Danish Crown is planning to sell a large slaughterhouse in the German city of Essen. According to German trade media, the sale is already in an advanced stage. It appears that the location will be taken over by the German company Westfleisch.
It is not surprising that the two companies have reached an agreement. Danish Crown and Westfleisch have been working together in a joint venture for some time. The slaughterhouse in question is the fourth largest slaughter location in Germany and has more than 1,000 employees. The location generates an annual revenue of €1.34 billion.
New strategy
Danish Crown has been facing difficulties for years. A weak result is also expected for the upcoming annual report. The company believes that divestments in the challenging German market could help it stay afloat. The company is fully focusing on its core activities. In August, Danish Crown already sold its stake in the large Danish logistics company Agri-Norcold.
This also includes a withdrawal from Germany. Danish Crown states that the scarcity in the German market is the main reason. In January 2023, the company announced its intention to reduce its presence in the German market because scarcity has driven prices there too high. The announcement was immediately followed by the closure of the Boizenburg location.
Vion
Foreign players have been increasingly withdrawing from the German market in recent years. Vion, the largest Dutch slaughterhouse, is also completely withdrawing from the German market. The company recently reached a deal on the beef locations with Tönnies. The sale of the remaining pork slaughterhouses is yet to come. Even before announcing the departure from Germany, Vion had already divested some slaughter locations.
