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ANNOUNCED AS TEMPORARYNo
Financial assistance in foreign market
On 19 June 2018, the Nordic Investment Bank (NIB) and Danish Crown A/S signed a loan agreement having a total value of EUR 100 million (approx. USD 116 million). The loan will support the company's acquisition of the Polish company Gzella Meat Group as well as the construction of a meat processing plant in China. The maturity of the loan is 7 years.
The Polish company is a producer of various meats and cold cuts of pork, beef and chicken. The company owned a processing plant, a number of logistics centres and 250 retail stores. The Polish subsidiary of Danish Crown Sokolow Group acquired the company in May 2018.
The construction of the meat processing plant will be located in Pinghu, China. According to the NIB, the plant is expected to produce up to 14,00 tonnes annually. The plant will mainly produce "fresh meat cuts, fully cooked products and semi-cooked products" using the Danish raw pork and other meats.
In this context, the NIB stated: "The new meat processing plant in Pinghu, close to Shanghai, will utilise raw material from existing slaughter houses in Denmark. Production at the plant will complement exports and provide access to new business segments. This is expected to enlarge the geographical market for processed meat and secure direct access to a high consumer growth market." Additionally, the bank noted that the: "acquisition of the Gzella Meat Group adds a local high-end brand to the Polish product portfolio."
Danish Crown A/S has its headquarters in Denmark with 14 offices worldwide. The company is a meat processing company providing various meat products of pork or beef including fresh packaged meats. According to the company, the Group is the largest pork exporter in the world "selling pork cuts in more than 80 countries worldwide."
The NIB is an international financing bank and is jointly owned by Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. The bank provides financing to private and public projects mainly located in the eight countries at attractive conditions. The eligibility criteria of NIB financing is that: "All projects financed by NIB should improve competitiveness and/or the environment, in accordance with NIB's mandate and eligibility criteria. Furthermore, outside the membership area, projects financed by NIB should be of mutual interest to the country of the borrower and the member countries."
A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the investment support granted here is discriminatory.
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