Smithfield, Kansas City Sausage form joint venture

Smithfield, Kansas City Sausage form joint venture

SMITHFIELD Foods Inc. has reported a 50/50 joint venture with Kansas City Sausage Co. LLC, including its Pine Ridge Farms LLC sow farm, to build Smithfield's packaged meat business, especially in breakfast and dinner sausages.

Terms of the joint venture were not disclosed.

The breakfast and dinner sausage categories represent a market worth more than $4 billion per year in foodservice and retail sales, according to the announcement.

This represents "a big opportunity" for Smithfield to grow in two important packaged meats segments "that haven't been a focus for the company," chief executive officer and president C. Larry Pope said.

Kansas City Sausage has been one of Smithfield's largest customers for live sows to process sows and produce sausage, and the joint venture will enable Smithfield to move sows directly into branded packaged meats, Pope said.

The venture will merge Kansas City Sausage's efficient, low-cost operations and high-quality products and Smithfield's strong brands and marketing and sales team to continue to expand both companies' packaged meat businesses, Pope said.

Kansas City Sausage, with sales totaling $200 million, has operations in Des Moines, Iowa, and Kansas City Mo. In Des Moines, the company produces raw materials for sausage as well as for hams and hides. Its Kansas City plant is the newest sausage processing facility in the U.S.

Smithfield, headquartered in Smithfield, Va., is the largest hog producer, pork processor and pork packaged meat company in the U.S., with sales totaling $13 billion.

Volume:85 Issue:08

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