CPF in takeover talks of US firm

Acquiring foreign businesses will be one of the major strategies applied by CPF in the next five years in order to grow its international presence.

The listed company aims to increase its revenue by at least 10 per cent per annum on average, president and CEO Adirek Sripratak said yesterday.

CPF is also looking for possible acquisition deals in Europe and Russia.

"To invest in acquisition deals in [markets] such the US and Europe will help us to top up our food businesses. It is also in line with our strategy to invest in countries with potential, as well as to expand our downstream businesses, including foods and retailing," he said.

CPF will invest between Bt70 billion and Bt80 billion in expansion over the next five years, of which 60 per cent will be allocated to overseas markets, including China and Vietnam.

CPF posted 13-per-cent year-on-year growth in its revenue for the first six months. It also achieved Bt5.6 billion in profit, more than double last year’s earnings in the same period.

Adirek said the company expected to achieve Bt430 billion-Bt450 billion in revenue this year, while profit in the second half should be better than earnings in the first six months.

Some 36 per cent of revenue is from domestic sales, while 58 per cent is from investment in 13 overseas markets, and 6 per cent is from Thai exports.

"We have already invested in many potential markets around the world, including Asean, China, India and Russia. In Asean, we have invested in full-scale business activities in Vietnam over the past 25 years, and will expand heavily into the Philippines in the near future. The company is looking to expand its business into Africa," he said.

Myanmar, Indonesia and Brunei are the only Asean markets in which CPF is yet to invest.

"In our overseas expansion, we are still focusing on creating the value chain of our core business, starting from up- to downstream activities, such as feed mill and farming businesses, food processing, ready-to-eat foods, retailing and restaurant businesses," said Adirek.

CPF expects the contribution from domestic sales will decline to about 30 per cent in the next five years.

The contribution from food business will increase from 12 per cent currently to 20 per cent, while feed-mill business will decline from 50 per cent to 40-45 per cent, and farming business from 38 per cent to 35 per cent.

The chief executive said that the implementation of the Asean Economic Community next year would have different levels of positive impact on all member countries.

"Thailand, however, has a good geographical strength, being located at the centre of Asean and connecting land transportation with other countries in the region, such as Laos, Cambodia and Vietnam in the east, Myanmar in the west, and Malaysia and Singapore in the south.

"Such networking will lead to strong harmonisation of those member countries, and that will drive a booming economy in the region," he said.