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Cranswick picks up premium pig farmer Packington Pork

Cranswick has been working with Packington for 14 years, but will now take on its pig farming operations across Staffordshire, Nottinghamshire and Lincolnshire

Cranswick plc -

Cranswick plc (LON:CWK) has acquired a UK premium pig farming business as it moves to become more "self-sufficient" and take control over part of its domestic supply chain.

The FTSE 250 company said in a statement on Tuesday that it has purchased Packington Pork Limited, a farming and rearing business, from the Mercer family, having worked with the business for 14 years.

The Mercer family will retain its free range poultry operations as a standalone business under the Packington name.

The latest acquisition comes amid rising pork demand, caused by an outbreak of African swine fever in China, which boosted Cranswick’s far eastern export revenues by 94% in the six months to the end of September, and pushed overall sales up 7.1% to £770mln.

Cranswick said the purchase boosts its self-sufficiency in UK pigs processed to “over 25%", securing "direct control over a significant part of its supply chain for premium pigs, reinforcing its commitment to developing a sustainable and traceable farm-to-fork operation”.

The company has been upping its investment and acquisition spend in recent months, upgrading three of its existing pork primary processing facilities, as well as splurging £41.3mln in July on European non-meat supplier Katsouris Brothers Limited.

Analysts at Peel Hunt said: "This will increase own supply by c5,000 pigs per week and take internal supply from 19% to 27% of Cranswick’s total requirements."

"There will be no change in Cranswick’s turnover given Packington was part of the supply chain, but the acquisition should make a helpful contribution to the company’s farming margin and enhance group profits by c2%," they added.

The broker kept the stock at a 'hold' rating, with a target price of 3,000p.

Shares dipped 0.6% to 3,302p in mid-morning trading on Tuesday.

--adds broker comment and share price

Quick facts: Cranswick PLC

Price: 3404 GBX

Market: LSE
Market Cap: £1.79 billion

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