£170m cash injection into Boparan Holdings

Leading UK food entrepreneur Ranjit Singh Boparan has set his sights on a transformation of his empire with the announcement of the intended sale.

Mr Boparan, the owner of Birmingham-headquartered 2 Sisters Food Group, which has chicken processing factories in West Bromwich and Wolverhampton, and high street restaurant brands like Carluccio’s and Gourmet Burger Kitchen, plans to sell the European poultry operation to his Boparan private Office for a fee in excess of 200m euros.

The European poultry business – which trades as 2 Sisters Storteboom and employs 2,700 people – will join the ranks of Bernard Matthews, Banham Poultry and Elkes Biscuits in the BPO, along with Mr Boparan’s portfolio of restaurant businesses.

Mr Boparan said: “This is a significant and transformational deal and unlocks many opportunities for the future, so we are very pleased to announce an agreement has been reached. All my companies will benefit as it creates a stronger, more agile group of businesses and provides a platform for an unprecedented level of internal investment.”

“As well strengthening BHL, it gives the European poultry business, under the BPO, a dedicated regional focus on its European markets, unlocking undoubted growth opportunities through a focus on quality, animal welfare and sustainability.”

The arms-length transaction will strengthen BHL’s 2 Sisters Food Group’s balance sheet and will enable it to reduce net debt levels to the lowest point in over a decade, and activates plans that Mr Boparan is calling his ‘Next Generation’ investment programme.

This programme will heavily focus on ambitious sustainability goals and investment in food processing technologies.

BHL’s current Bond funding arrangements expire within the next 12 months. This latest cash injection will give the business options for refinancing when the time comes to address corporate funding in the coming months.

The European poultry sale is subject to Polish anti-trust approval with an anticipated completion date later this month.

Mr Boparan promised the further investment plans will be announced as this change is embedded and its potential is fully realised in the coming months.

The European market – and the Netherlands in particular – has faced external challenges in recent years.

As well as inflationary and energy pressures felt globally, the Dutch market has faced the impact of an influx of Ukrainian poultry products being traded aggressively in the European market, as well as agricultural policies adopted by the Dutch government. This has adversely affected prices.

2 Sisters Storteboom has six poultry processing centres in the Netherlands and three in Poland

2 Sisters produces around one third of all poultry consumed in the UK – approximately 6.2 million chickens every week. It is also one of Europe’s largest producers of Ready Meals, creating prepared meals, pizzas, soups and bakery products for multiple retail customers. The group has sales of around £3 billionn and employs 13,000 at 12 manufacturing sites across the UK.