Tyson Foods eyes global poultry expansion through investment in Brazil’s Vibra Foods

02 Sep 2019 --- Within the scope of its global growth strategy, US multinational Tyson Foods has reached an agreement to invest in the foods division of Grupo Vibra (Vibra Foods), a Brazilian producer and exporter of poultry products. The completed deal will support Tyson Foods’ aim to bolster its international reach, which previously relied on US exports. Terms of the agreement have not been disclosed, and the transaction is still subject to approval by Brazilian regulators.

“We divested our business in Brazil about five years ago. This is our first investment there since that time. Unlike our previous venture, we are an investor, not an owner of the business,” a spokesperson of Tyson Foods tells FoodIngredientsFirst.

Since last year, Tyson Foods has expanded its global presence through the acquisition of Keystone Foods, which includes operations in China, South Korea, Malaysia, Thailand and Australia.

In June, the company acquired Brazillian global food company BRF’s four poultry production facilities in Thailand, one in the Netherlands and another in the UK, in a deal worth an estimated US$340 million.

Tyson Foods’ four plants in Thailand produce a wide range of fresh and frozen, value-added raw and fully-cooked poultry products. These include highly specialized cuts for retail and foodservice customers throughout Asia and other markets, including Europe. Meanwhile, its processing locations in the Netherlands and the UK specialize in processed chicken products for retail and foodservice customers in Europe.

“This investment will enable us to access poultry supplies in Brazil to meet the growing needs of Brazilian customers and of priority demand markets in Asia, Europe and the Middle East,” says Donnie King, Group President, International & Chief Administration Officer at Tyson Foods. “It’s part of our strategy to develop a more flexible supply chain and mitigate the volatility of our previous model, which relied primarily on US exports.”

Tyson Foods currently generates US$7 billion in international sales annually. This includes US$5 billion in US export sales and approximately US$2 billion in in-country revenues. 

Over the next five years, it is estimated that nearly 98 percent of protein consumption growth will happen outside the US. “That’s why we’re growing our business outside the US,” adds King.

“This agreement is the result of the mutual trust between our two companies and the goal of both companies to expand globally,” says Flavio Sergio Wallauer, Chairman of the Board for Grupo Vibra. “We also both believe in the importance of constantly adding value to our products. For us, this includes continuing to grow, innovate and strengthen the position of our brands, Nat and Avia.”

As part of the agreement, Grupo Vibra will spin-off its genetics multiplication business, Agrogen, into a separate company.

“This partnership will be important to further develop our businesses in Brazil and foreign markets, granting access to new technologies and investments mainly in R&D. We will capitalize on a global distribution network to reach new markets,” says Gerson Luís Müller, CEO of Grupo Vibra.Tyson Foods, Vibra Foods, Poultry market, US exports, Brazil exports

By Benjamin Ferrer