Danish Crown finalises exit from Chinese meat processing operations
The Danish meat producer hands over its Pinghu facility to COFCO-owned company as part of a wider business shift.
CHINA – Danish Crown has completed the sale of its pork processing plant located in Pinghu, China, to a company affiliated with the Chinese food conglomerate COFCO.
The facility, situated just outside Shanghai, officially changed ownership after all conditions outlined in a preliminary agreement reached in February were fulfilled.
The plant, which opened in 2019, was part of Danish Crown’s earlier efforts to establish a stronger processing footprint within the Chinese market.
Despite significant investment and repeated attempts to improve financial performance, the factory consistently fell short of expectations over its six years in operation.
In late 2023, Danish Crown’s leadership conducted a strategic review of its assets in China and concluded that selling or shutting down the Pinghu plant would be the most practical course of action.
Management shifts focus
According to Group CFO Anders Aakær Jensen, the decision marks a necessary step in the company’s ongoing restructuring, which aims to refocus resources on more profitable areas of the business.
He acknowledged the difficulty of letting go of employees who had worked to improve operations at the site but stated that the factory’s long-term viability no longer aligned with Danish Crown’s business direction.
Although the Pinghu facility is no longer part of the company’s strategy, Jensen emphasized that China continues to be a significant export destination for Danish pork products.
In the financial year 2023/24, Danish Crown recorded pork exports from Denmark to China valued at approximately US$342 million (2.4 billion Danish kroner).
Transaction value and financial impact
The sale is expected to bring in a sum in the tens of millions in US dollars, with the precise figure to be disclosed in Danish Crown’s annual report for the 2024/25 financial year, due in late November.
The company did not disclose the exact purchase amount or the name of the COFCO-affiliated buyer.
Danish Crown has not announced any plans to replace the facility with another processing site in China.
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