Three of the leading meat processors in Scotland are to merge, in a move that is hoped will secure a strong future.
The meat-processing sector has struggled over recent years. With rising prices in raw materials and consumer spending forcing retail prices, work has slumped.
By joining forces, Mathers, Scotbeef and Scottish Premier hope to shore up their operations.
However, the deal is set to come at the price of a number of jobs. With Mathers and Scottish Premier based in Inverurie, the town could see significant redundancies.
The number of positions being lost has not been confirmed, with a statement released by management at the three processors saying:
“The intention is to retain as many of the positions as possible, however it is likely that there will be some job losses.”
Consultations are already under way with the 230 members of staff affected.
The number of companies announcing mergers has been steadily increasing since the economic downturn. For maximising assets and minimising losses, such partnerships can work well.
Similarly, other companies have been able to grow through acquisitions, many of which have been funded through such strategies as invoice factoring.
The first major move to come out of the processing merger will be the creation of a new state-of-the-art facility.
Discussing the deal and the challenges facing the meat-processing industry, the MD of Scotbeef parent company J.W.Galloway, Robbie Galloway, said:
“To ensure sustainable business, efficient facilities are now a prerequisite.”
A multi-million project, it will replace the disparate facilities of Scottish Premier and Mathers in Inverurie.