New Hope eyes overseas buys

New Hope Liuhe, a listed-company of China's largest feed-grain producer New Hope Group, said it will consider more overseas acquisition possibilities to feed the country's growing appetite for meat.

"We will look into the possibilities of mergers and acquisitions abroad. This is not only to satisfy domestic demand but also part of the company's strategy to have global presence," Deng Cheng, vice-president of New Hope Liuhe Co Ltd, told China Daily.

He said the targets must have good natural resources, a safe investment environment and cost advantages in terms of production, adding that countries in Central Europe such as Poland have very good conditions.

As a major meat producer, New Hope Liuhe plans to increase its capacity, especially in poultry, in the next few years as the Chinese people include more meat in their daily diet. It also has some of the country's leading beef, dairy, pork and poultry brands.

The company plans to invest about 8.8 billion yuan ($1.3 billion) for pig breeds, Deng said.

Liu Yonghao, the billionaire chairman of New Hope, said in April that the group will invest up to 10 billion yuan in the next three to five years on high-end animal protein and food-related assets overseas.

The privately-owned company in Sichuan province is also seeking to acquire livestock-breeding companies overseas, he said, citing a lack of such capabilities in China and increasing domestic demand for beef, lamb and seafood.

A changing diet coupled with a massive boost for the meat industry has pushed more Chinese companies into traditional meat-producing regions such as Australia and New Zealand, where meat industry has been driven largely by Chinese consumers.

This month, the authorities in New Zealand finally gave the go-ahead for Silver Fern Farms, the country's biggest meat cooperative, to sell a half stake to a Chinese pig processor Shanghai Maling after long negotiations.

The deal, valued at NZ$261 million ($191 million), will be able to pay off SFF's debt and its upgrades of plants and operations.

It will also help the New Zealand company to gain access to thousands of retail outlets, as Shanghai Maling has direct control of 800 supermarkets and stores.