When we asked Vion CEO Ronald Lotgerink (in photo) last summer whether leaving Germany was an option, he firmly replied that he did not want to completely sell off the loss-making German activities. Today, the meat company suddenly announces that it is working on a permanent departure from Germany. This gives the reorganization soap - which was sometimes accompanied by wild rumors - a new chapter. It is striking that the company is now suddenly coming clean.
De mededeling van Vion clearly deviates from previous reporting on the German restructuring, which has been going on for a long time and is very complex. Before this, communication only took place when actual events occurred. Such as at the beginning of the year, when it was announced that four locations in Germany would be divested. This plan had already been leaked in a preliminary stage, but was subsequently denied by Vion. The rumors later turned out to be true. That didn't deserve the beauty prize.
Now Vion is taking a different tack and opening up the company. Vion says it is working to find partners for the other German activities and the relevant employees. Although it is not in black and white, it appears that Vion will leave Germany completely. Internally, the plans have probably been going on for some time. After all, the German branch was opened last summer already privatized, which quietly prepared for a possible sale. Vion has more than ten locations in Germany. In any case, the plans have far-reaching consequences for the company; more than half of the turnover is generated on the German market.
Tackling rumors
A Vion spokesperson indicates that he does not want to say more than is stated in the press release. However, it is indicated that a conscious decision has been made for proactive communication about the plans in place. This is to provide clarity, both internally and to the outside world, and to tackle the rumors that are circulating again. Vion is already in discussions with buyers for the German factories, it is indicated. The ball started rolling when locations were divested at the beginning of this year, including to major competitor Tönnies. It then turned out that there was also interest in other German locations. It is remarkable that Vion states that the German activities are profitable, something that cannot be concluded from the most recent annual figures.
Although discussions with various interested parties are still ongoing, a permanent departure seems very likely. Internally, Vion seems to have already said goodbye to the German activities that have caused a lot of headaches in recent years. "With possible divestments in Germany, Vion is paving the way for further investments in the Benelux," the company said.
By openly announcing its sales plans, Vion may also be trying to up its game. This may result in interest from other parties that will benefit the sales prices. Competing slaughterhouses in Germany are to a greater or lesser extent aware of the willingness to sell, but this does not apply to private equity companies. Perhaps investors will join in the bidding from now on. After all, final decisions still have to be made, Vion indicates. The German branch of Vion will probably break up into parts.
History repeats itself
In any case, Vion's management under the leadership of Lotgerink, which has had to post heavy losses in recent years, cannot be blamed for allowing the problems to fester. If Vion were to permanently leave Germany, this would be a rigorous measure that would result in the loss of a lot of scale. More than ten years ago, the British activities were also divested and turnover approximately halved. This history seems to be repeating itself again.