Finnish food group HK Ruokatalo and the Federation of Swedish Farmers (LRF) are planning to set up the largest poultry processor in the Nordic/Baltic region.

The two parties are looking to reinforce their standing in the growing poultry meat market and have signed a letter of intent exploring their cooperation. The venture will involve their joint subsidiary AS Tallegg of Estonia, and Ruokatalo subsidiary Broilertalo of Finland. LRF would also bring Swedish Kronfagel and Danish Danpo A/S to the venture via its Spira subsidiary.

The companies involved are leaders in their respective national markets. Danpo generated turnover of €172.5m (US$160.6m) in 2001, compared with Kronfagel’s €141.m, Broilertalo’s €126m and Tallegg’s €31.1m

Total production volume was 192m kilos, and the companies together employ some 3,400 people.

HK Ruokatalo and LRF have worked closely together since summer 2001, but the new agreement promises to take their cooperation to a new level. Following the letter of intent, HK Ruokatalo and LRF will analyse the implementation models of and synergetic benefits arising from cooperation on a broader basis. The study is expected to be completed by September, reported the Baltic News Service.