Waterford-based Dawn Meats is understood to be in the process of acquiring rival beef and lamb processor Kildare Chilling. While details have yet to be announced, both sides are said to have reached a deal.
Family-owned Kildare Chilling is one of the main sheep processors in the State, accounting for about 20 per cent of lamb processing. It employs roughly 350 people and had a turnover €140 million in 2021.
A tie-up with Dawn, which will need to be cleared by the Competition and Consumer Protection Commission, will further consolidate the processing industry here.
Farmers’ representatives reacted negatively to news of the deal, suggesting it would decrease competition in the industry.
“Look any takeover obviously means less competition, but look, it’s the way the world is going,” Tim Cullinan, president of the Irish Farmers’ Association (IFA), said.
“It’s sad to see a particular family business going out, obviously we would prefer if it didn’t happen … Anything that decreases competition is a risk,” he said as he attended the farming lobby group’s Annual General Meeting (AGM) in Dublin on Tuesday.
The president of Irish Creamery Milk Suppliers Association, Pat McCormack, said that while he did not doubt that such an acquisition would be described as consolidation, “it would be much more accurately described as competition reduction and farmers would look very sceptically at the implications of the move”.
“The trend with Irish beef processing is unmistakable and long term and that is the steady reduction in the number of buyers for farmers’ cattle,” he said.
“This move by Dawn will doubtless be described as ‘consolidation’, with promises that utilising spare capacity and economies of scale will allow Dawn to pay better prices to farmers for their cattle,” he said.
“We’ve heard it all before and it never happens. The only way of getting higher prices for cattle is more competition for them and this move simply removes another competitive element from the market,” Mr McCormack said.
Dawn Meats acquired Tyrone-based Dunbia, taking over Dunbia’s two plants in the Republic and combining Dunbia and Dawn’s UK businesses, back in 2017, making it the largest Irish beef processor in volume terms, ahead of Larry Goodman’s ABP.