010621 Tyson Take Steps to Bolster Foreign SalesJune 11, 2001Springdale, AR - Leading U.S. poultry producer Tyson Foods Inc., which in March backed out of a deal to expand into beef, announced moves to boost chicken sales abroad through units in Mexico, Panama and China. As part of a plan to increase sales in Latin America and Asia, Tyson increased its stake in closely held Tyson de Mexico SA de CV, bought a fully integrated broiler production plant also in Mexico, and signed joint venture agreements to increase production in Panama and China. Terms for the transactions were not disclosed. Tyson and other U.S. poultry producers have suffered from market oversupply that has driven down prices and pressured profits in the past year. It's now looking to overseas markets to bolster flagging sales after pulling out of plans to buy IBP Inc. In its 2000 fiscal year, Springdale, Arkansas-based got about $657 million, or 9% of its sales, overseas. Tyson said it entered an agreement to buy the remaining interest of its Mexican operations held by the Villegas family, which founded the business and retained a minority stake. Tyson will own 95% of the common stock of Tyson de Mexico. The Mexican unit also bought the poultry assets of Nochistongo, a production plant with capacity for about 500,000 birds a week that will boost its weekly capacity in Mexico to 2.2 million chickens. Production is sold to grocery and food service customers throughout Mexico and Latin America. Tyson said it formed a joint venture with Chinese partner Zhucheng Da Long Enterprises Co. Ltd. to operate a processing plant in China. The plant, located in Shandong Province and with an annual capacity of 20,000 metric tons, is expected to be fully operational in September. The company also said its Panama City, Panama joint venture with Alimentos Procesados Melo SA, began processing in a new facility that will produce products ranging from fresh to fully cooked chicken.
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