FRANCE: Poultry giant Doux admits receivership "an option"

By Dean Best | 30 May 2012

French poultry giant Groupe Doux today (30 May) admitted a move into receivership could be an option for the embattled company as it remains locked in talks with lenders and potential investors.

Doux, Europe's largest poultry processor, has accumulated debts of around EUR430m (US$534.3m) as it has battled volatile commodity costs and a struggling business in Brazil.

The company owes around EUR130m to Barclays and the negotiations come ahead of a deadline to pay off part of that debt next month.

"This week is a crucial week because there is part of the debt that should be paid off next month," a Doux spokesperson said. "Groupe Doux needs to find a solution as soon as possible."

The spokesperson said Doux could look to strike a deal with investors or a debt-for-equity agreement with its lenders.

However, he said receivership was also a possible option. A move into receivership would allow Doux to continue trading but also "freeze" its debts and any transactions with its Brazilian subsidiary, while allowing the company to trade normally. "For the moment, it's one of the options," the spokesperson said.

Media reports in France have speculated Doux could sell off assets in the country or look to cut jobs. The spokesperson said reports of possible disposals could be linked to "journalists speaking to our competitors". He refused to comment on whether Doux could cut jobs.

Last week, the Doux family, which owns 80% of the company, replaced CEO Guy Odri, who had been in the job since 2003. Jean-Charles Doux, son of the company's president, Charles Doux, is now chief executive. French bank BNP Paribas owns the rest of the business.

Last month, Doux leased out its plants in Brazil to rival meat processor JBS.

Sectors: Emerging markets, Financials, Meat & poultry

Companies: Groupe Doux, JBS

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Poultry giant Doux moves into receivership

Volatile commodity costs and a struggling Brazilian business has hit the French group and led to EUR430m of debt. The company has opted to move into receivership and focus on revitalising its domestic operations.

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