South African poultry processor Sovereign Foods has announced the acquisition of a multi-stage hatchery in its domestic market.

The company, the third-largest poultry producer in South Africa, has bought the Blue Hills hatchery in Midrand for an undisclosed sum. The hatchery was previously known as Hyline Africa.

Chris Coombes, Sovereign Foods chief executive officer, said: “The acquisition of this hatchery allows us to be almost self-sufficient in the supply of day-old chicks. It further centralises our day-old chick supply chain to our contract farmers in and around our Hartbeespoort abattoir.”

Sovereign acquired and upgraded the abattoir in Hartbeespoort in 2015.

Coombes said that, up until this point, Sovereign Foods has had to purchase a certain portion of its day-old chicks on the open market at a premium.  

“Now, our Blue Hills operation will eliminate this process providing security and resource efficiencies to our company,” he said.

“The acquisition means that we no longer have to buy in as many chicks from external suppliers and are able to keep tighter control over our supply chain. The hatchery is situated centrally in relation to our contract farmers and cuts delivery time in half. Shorter delivery time leads to better quality day-old chicks.” 
 
Sovereign’s new hatchery has the capacity to set 660,000 eggs weekly, which equates to production of 510,000 day-old chicks per week.
 
In October, shareholders in Sovereign Foods approved the takeover of the firm by private-equity firm Capitalworks following a ZAR907m (US$66.8m) cash offer but earlier this month Sovereign announced its merger with the Cold Storage Group (CSG), an Eastern Cape wholesaler of poultry and value-added poultry products.