Borges unveiled a new strategic plan through 2027 with Africa as a focal point. How did this initiative originate?
In the governance bodies, the transition from the third generation to the fourth was completed alongside the rollout of the new strategy. The timing overlapped with the pandemic when the plan and its scope were affected by global disruption. The milestone 125th anniversary of the company prompted a pause, and only now, with Mas de Colom serving as corporate headquarters, has the company moved forward. Expanding into Africa is a deliberate part of the forthcoming years, following prior efforts in India and China. The group has achieved notable success in India, where a related subsidiary anchors a core business line, while experiences in China were more mixed.
Would India’s experience be mirrored in Africa?
There is a growing belief that Africa presents a significant challenge and an immense opportunity. The per capita consumption of several product categories remains low, but that is seen as a long-term bet. Olive oil, for instance, is often used in religious contexts there. The approach begins with a measure of humility, aiming to identify, define, and limit opportunities. The first decision is straightforward, but the next step involves choosing the operational base. Africa is vast, with many trade-offs. The landing plan is at a very early stage, with reinforced concrete steps to be announced over the coming years. The company was founded in 1896 and prioritizes doing things right over moving quickly.
Will there be some sense of direction in the near term?
If a market presents itself as a true opportunity, it signals potential for product evolution as education and middle-class growth unfold, supported by greater liquidity. A strong emphasis on health remains a concern for both the public and public administrations, and substantial investment is flowing in. The entry in Africa began early but is expected to mature rapidly.
“There is confidence in announcing an acquisition in the coming months”
This strategic plan focuses on opportunities in Spain, Italy, and France. Is there any movement on that front?
At this stage, progress is ongoing on several fronts with plans to implement some steps in about three months. In June 2022, the Eagle brand was acquired in a niche that holds particular value. This marks the horizon for inorganic growth: targeted local acquisitions that can be managed from the headquarters and integrated with complementary channels and products within a broad Mediterranean cuisine concept. While the portfolio has long been associated with oil and nuts, the India experience highlighted pasta as a promising avenue, and leadership has established itself in this category.
So the aim is to buy products that complement one another and acquire competitors that add dimension? Or both?
In practice, both types of opportunities appear on the list. It is impossible to pursue everything simultaneously, so several lines run in parallel. There is confidence in announcing a deal in the coming months, even as other avenues remain under consideration.
Is there a budget for these purchases?
Yes, a budget exists, though it is split and flexible. Shareholders remain open-minded and favor approaches that create value for the group. For any operation below or around 200 million euros, or involving multiple concurrent moves, appropriate corporate structures will be considered without default rejections.
An IPO?
No concrete plan exists at the moment. It is clear that there is no imperative to alter the institutional setup unless a business opportunity adds clear value to shareholders. If such a chance arises, the options will be weighed without ruling anything out. The company has experience with various forms: a unit listed on the stock exchange, joint ventures with external partners, and both majority and minority arrangements, as well as alliances. The organization remains open to any value-adding opportunity.
Will there be a change in shareholding with the arrival of the fourth generation?
The Pont Family Holding acts as the group’s umbrella, based in Tàrrega, with four shareholders from four family branches. Each holds 25 percent. The board comprises five directors, two external consultants, and a non-executive secretary. Four directors represent the family branches, while the fifth is an executive who guides the leadership. Changes are not anticipated at this stage.
“If sustaining profitability requires sacrifices, the company will make them”
Borges carries an investment plan of 108 million euros. What will the funds support?
The plan has two large components. The first focuses on physical assets, expected to absorb almost 60 percent of the total. This includes machinery investments to boost industrial or energy efficiency and raise productive capacity. A significant portion will be aimed at energy efficiency improvements. The second component targets marketing to continue strengthening the brand image, a valuable intangible asset that requires ongoing investment.
Is energy efficiency tied to a sustainability agenda?
The commitment to sustainability has always existed, and today there are more tools to apply it effectively. The aim is not to spend money unless it advances sustainability. If changes are needed to stay sustainable, the company will make them.
Have inflation effects been passed to consumers?
It has not been possible to transfer even a portion of the cost increases this fiscal year. Inflation affects many inputs, including materials, transport, and energy, with production costs for olive oil showing a sharp rise. Prices on supermarket shelves have not fallen, and the company remains committed to social responsibility while seeking a balanced approach for all stakeholders. The organization, 125 years old, seeks to endure for another century with solid resources.
Do prices for olive oil and nuts continue to rise?
It is likely that costs will stay elevated until production costs reach a sustainable level. Prices depend on raw material markets and other variables, and there is no guarantee of a downward trend in the near term. Structural costs must be managed and passed along where possible. The times demand adaptability, a reminder of Darwinian logic in business reality.
Which challenge matters most now?
The priority is to advance sustainability that benefits shareholders, employees, and customers alike, laying a foundation for a plan that could endure for a century.
“Innovation centers on products already in the portfolio”
– The last financial year saw a business volume near 700 million. It is projected to reach 1,000 million within five years. How is that calculated?
– The estimate rests on several pillars, starting with ongoing innovation. The portfolio includes existing products with hopeful outcomes, followed by expanding into new channels and geographic markets. The presence spans over a hundred countries, though not all markets perform equally. Acquisitions are a possible, but uncertain, factor in the projection.
– Where is Borges’ innovation headed?
– About one in ten ideas makes it to the market. The focus is on Borges next, meaning the creation of products that incorporate any current ingredient as a core or supporting element. The aim is never to disrupt the core. Nuts, for instance, underpin many vegan offerings. A new platform seeks to help the industry locate healthier substitutes for ingredients that fail sustainability or health criteria. A clear example is the introduction of a healthier fat used in pastries.