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August 20, 2007

UPDATE – BELGIUM/UK: Pinguin snaps up Salvesen Foods

Leading European vegetable processor Pinguin has admitted jobs could be under threat at the company’s new UK acquisition Christian Salvesen Foods.

Leading European vegetable processor Pinguin has admitted jobs could be under threat at the company’s new UK acquisition Christian Salvesen Foods.

Belgium-based Pinguin has struck a deal to buy Christian Salvesen Foods, the UK’s largest processor of frozen green vegetables, in a deal worth GBP17.2m (US$34.2m).

Under the deal, Pinguin, which already owns two sites in the UK, will lease the land and buildings at three Salvesen sites in Lincolnshire from the UK firm.

Salvesen will hang onto its sites at Grimsby, Hull and Lowestoft, which provide contract processing and storage services.

Pinguin CFO Steven D’Haene told just-food today (20 August) that Pinguin would undertake an “in-depth analysis” to see how to improve efficiency at the three sites.

“It could occur,” D’Haene said when asked about the prospect of job cuts at the Christian Salvesen sites. “We need to investigate where we can make savings.”

Pinguin recently faced criticism for plans to cut jobs at one of its other two facilities although D’Haene insisted the process at the Padley site had been handled “smoothly”.

The recent wet weather in the UK is set to slash the crop of green vegetables in the UK. Earlier this month, Pinguin CEO Herwig Dejonghe urged the country’s retailers to help the sector ride out the recent severe floods in the country.

D’Haene admitted today that conditions in the sector are “tough” but insisted now was the best time to acquire a business like Salvesen.

“If we wait until the industry recovers, the prices and the premiums we have to pay would be much higher,” he said. “The industry has been suffering for years now but something has to happen and we are best-placed to make it happen and bring the volumes together.”

D’Haene added: “We believe the market for frozen vegetables in the UK is still there. The British will still want to eat British peas.”

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