Australian Lamb Company has sold after 30 years in operation to internationally owned Minerva Foods Australia in a $400 million deal.
The sale will include the Victorian meat processor's two factories; the facility in the south-west town of Colac and the sales, marketing and bone room located in Melbourne.
Minerva Foods Australia is 65 per cent owned by its South American branch and 35 per cent by the Saudi Agricultural and Livestock Investment Company (SALIC).
Australian Lamb Company (ALC) general manager Darren Verrall says it is an exciting time for both companies.
"To bring together the wealth of knowledge, experience and contacts that both businesses possess will be an excellent foundation for growth into the future," he said.
Export opportunities expanded
Minerva South America is a large beef exporter listed on the Brazilian Stock Exchange, selling meat around the world with investments in countries including Canada, Brazil, Ukraine, India and the United Kingdom.
SALIC is wholly owned by Saudi Arabia's public investment fund and already has a presence in Australia, including owning 211,000 hectares of farmland and two lamb processing plants in Western Australia.
Minerva Foods Australia chief executive Iain Mars says the workforce at ALC produces an "incredible product".
"It is well respected around the world, and we are looking forward to building on this reputation," he said.
"Minerva Foods prides itself on its commitment to sustainability, community and its people and looks forward to engaging with the workforce and broader community."
Industry market analyst Matt Dalgleish said the sale would open export opportunities.
"Particularly that presence in India now that we've got a free trade agreement with India," he said.
"And Saudi Arabia historically has taken a high proportion of sheep meat, both mutton and lamb, from Australia and in recent years that has been in decline."
"So, with SALIC involved with this joint venture, that could look to increase volumes of sheep meat back into Saudi Arabia."
Further access into India and Saudi Arabia could also benefit Australia's exports of halal certified products, Mr Dalgleish said of a sector that is projected to be worth $7 trillion globally by 2030.
"That's a huge growth opportunity for the sector, targeting that halal-prepared meat segment," he said.
"It's a good thing for the supply chain, that will all flow back to the producers."
ALC's executive management will remain in their current roles for what is expected to be a "seamless transition" with "operations continuing as normal".
Mr Dalgleish said having extra money injected into the company could also help address workforce shortages, with investments in automation offering a potential solution.
"Given how difficult it has been to secure processing staff, I'd expect they would be seeking to grow the workforce," he said.
"It's been a tough couple of years really in terms of high pricing within Australia and that's meant margins have been quite squeezed."
"This kind of consolidation is not unexpected."
