Officials from US corporation Smithfield, which acquired former swine fattening farm Comtim Timisoara for 33 million dollars (27 million euros) last year, have announced they are already making profits.
"Although we were expecting substantial losses for a year or two, the Noul Comtim (New Comtim) has been making profits on imports of frozen meat since last year," said Michael H. Cole, vice-president and member of Smithfield''s Board of Directors.
He chose not to give any figures, saying that turnover was not relevant for the time being because the business was just being built and that several years would be needed until the company''s planned activities could be conducted at fully capacity.
"We already have five years of experience in Poland and have seen how opportune the business became after they entered the EU. In the meantime, Romania''s economy has become more stable and risks have reduced," Cole said. He added that Smithfield had invested approximately 65 million dollars in their new business in Timisoara, which includes the price paid for Comtim.
The American company entered the European market in 1998 by making investments in France and Poland. Company representatives say they wanted to do business in Romania as early as at that moment, and were invited to bid for Comtim.
"We had a number of reservations, especially about property legislation and inflation, so we did not make an offer," Cole said.
The plant in Timisoara was sold piece by piece after having gone bankrupt and entering liquidation. The operation was handled by a branch of the audit firm PricewaterhouseCoopers. Part of Comtim, including the slaughterhouse in Freidorf, was acquired by Italy''s Agrotorvis, while the rest of the farms and the slaughterhouse in Beresgau were acquired by an Australian company, whose owners are the Romanian-born Nicolae Cojocaru and Grigore Alexa.
"In the autumn of 2003, one of the Agrotorvis shareholders, Renato Andretta, approached Smithfield with a proposal for a strategic partnership in Romania.
"Following talks that were completed in March 2004, Smithfield acquired 70.5% in what Agrotorvis had bought in Timisoara. We later negotiated with Nicolae Cojocaru and Grigore Alexa and bought out their share last autumn. We put together what we bought from the Italian and what we bought from the Australian company under the name of Noul Comtim (New Comtim)," Cole explained.
The company''s business plan for the next few years targets the establishment of 250 private farms, 100 of which will be in Timis county, with the rest in Arad and neighbouring counties.
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