The Dutch firm announced a joint venture with New Zealand-based agribusiness group Scales.
Esro Food Group, an animal by-product processor, and agribusiness firm Scales Corporation have become 50/50 shareholders of Esro Pet Food BV (under the Esro Food Group).
Through the new partnership, both companies will expand into the production of pet food ingredients, centering operations at two European plants in the Netherlands and Belgium.
“We are excited to be able to combine Esro’s existing processing and procurement strength with Scales’ specialist knowledge of the pet food industry to be able to offer our pet food customers a truly global solution for their ingredient procurement requirements,” comments Scales’ Managing Director Andy Borland.
An existing factory in Belgium will be converted into a dedicated pet food ingredient plant and it is expected to be fully operational by the last quarter of 2023.
The ingredient production from the European plants is expected to complement Scales’ and its shareholders’ existing businesses across the USA, New Zealand and Australia.
Each company has appointed two directors to the board of the joint venture, to which they have appointed Leon Coolen as the Managing Director, with his extensive experience in leading food and pet food ingredient businesses.
The joint venture is not anticipated to have a positive impact on earnings until part way through FY2024. Scales has provided lending facilities worth €15 million ($16.5M) for capital expenditures.
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