The Victorian Farmers Federation’s Chicken Meat Group has labelled the move reprehensible and called on Ingham’s parent company, private equity firm TPG Capital, to show respect for the investment of its farmers in upgrading facilities to keep supplying the best product.
“It’s completely unreasonable to pull the rug out from underneath loyal suppliers without warning,” VFF Chicken Group President Allan Bullen said.
“Farmers have gone through the process of upgrading our farms with state of the art equipment in order to supply high quality products to Ingham’s, and they’ve responded by squeezing their farmers.”
“We’re concerned about our futures because we know what happened in NSW – they shut down and left the market; and in Queensland the chicken meat farmers have taken Ingham’s to mediation because Ingham’s have refused to compensate them for increased production costs.
“These actions have undermined confidence in the chicken meat industry.”
TPG bought Ingham’s in 2013 for $880 million, and has since stripped $600 million worth of assets from the company with the intention of floating it on the Australian Stock Exchange for more than $1 billion.
Ingham’s, which claims a 40 per cent chunk of chicken and turkey sales in Australia, had revenues last year of $2.28 billion. Yet TPG has announced it will slash costs by $200 million by reducing its 8,000 strong workforce and closing some of its 340 facilities and farms across Australia and New Zealand.
“Farmers should not be forced to bear the consequences of TPG trying to fatten the company for the market,” Mr Bullen said.