Bell Food sells its sausage unit in Germany to Zur Muhlen
The slow performance of Bell Food Gropu's unit for sausages in the German market convinced the executives of the Swiss company to sell this business to Zur Muhlen Group. In mid-term, Bell Food Group intends to focus on and further expand its strong position in the air-dried ham segment, announced the company.
"The retail market for meat and sausages in Germany is declining. Due to an oversupply to the market, it is difficult to pass on the sharp rise in the price of pork to sales prices. As the market share is less than one percent, the Bell Food Group has a subordinate market position and consequently, the outlook is poor. The Bell Food Group has therefore decided to sell its German sausage business. Zur Muhlen Group is the ideal buyer and will take over the plants in Suhl and Borger together with all employees. The sale of the sausage business will bring some changes for the Administration and Central Services departments", said the Swiss group in a press release.
The sale of the sausage business will affect jobs in the Administration and Central Services departments of Bell Germany. Negotiations with the employee representatives regarding a social compensation plan will be initiated in good time and the statutory participation rights will be respected in full.
"The sale will reduce net revenue by some CHF 85 million (€76.3 million). The sale of the German sausage business will have a positive impact on the Bell Food Group’s cash flow and EBIT of some CHF 10 million (€8.9 million) per year from 2020. The dependence on fluctuations in the prices for raw materials will also decrease. The sale will incur mostly non-cash one-off costs of around CHF 35 million (€31.4 million) in the 2019 financial year", reported Bell Food Group.
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