French poultry processor Doux has brushed off a suggestion from the chief executive of local peer Tilly-Sabco the two companies should merge to “save” the country’s poultry industry.
Tilly-Sabco boss Daniel Sauvaget has warned the end of EU subsidies for poultry exports outside the bloc could endanger the sector. Earlier this week, Sauvaget reportedly said a deal with Doux was essential for the future of the industry.
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“Things are progressing in this direction,” Sauvaget was quoted as saying by Reuters.
However, Doux, which has also criticised Brussels’ decision to end export subsidies, poured cold water on the idea.
The company told just-food “an alliance, merger or any other transaction” with Doux was “not on the agenda”.
“Such an alliance would create problems concerning business models, [which are] integrated by Doux and outsourced for Tilly Sabco.”
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By GlobalDataDoux is hoping to exit administration next month. The company entered administration in June last year with debts of around EUR430m. In its time in administration, Doux has restructured the business, selling off plants and modernising others.
The company said in September the EU’s move to end subsidies meant it would have to adapt to “new trading conditions”. However, Doux said it had provided evidence it could cope.
Reflecting further on the comments from Sauvaget, Doux added: “The proceedings concerning the Doux Group should be seen right through to the end. Such an alliance, between Doux and Tilly Sabco, suggested by the press is a curious approach even brutal, during a time when the president of Tilly Sabco says to all media that there are great difficulties. The problematic surrounding the markets is the same but it is different surrounding the companies.”
