The European arm of US-based pork producer Smithfield Foods has announced a strategic alliance with Spanish packaged cold cuts company, Argal Group.

Smithfield will buy a 50.1% stake in the company, while Argal’s present shareholders will keep the remainder of the shares.

In a joint statement, Smithfield described the partnership as “a medium-term plan”. Both companies will work through an “agreed framework of joint management”, it said.

Argal’s portfolio includes charcuterie products such as cooked and cured ham, bacon, turkey, sausages, fuet and pâté.

Through the partnership, Argal will gain access to Smithfield's European distribution channels, as well as "a vertically integrated supply chain and other assets".

Smithfield runs operations across Europe, with plants, hog processing sites and corporate offices based across Central and Eastern Europe in Poland, Slovakia, Hungary and Romania.

Argal has production centres in Catalonia, Navarra and Extremadura, as well as nine distribution centres elsewhere in Spain. It currently exports to more than 30 countries through subsidiaries or distributors.

Argal chairman Antonio Escribá and CEO José María Orteu said the investment would build the company’s “growth possibilities” through “internationalisation, technological evolution, sustainability and competitiveness in general”.

The partnership is also expected to help Argal tackle future business challenges in relation to “food and its different marketing channels to customers and consumers”, they said.

They added: “It is also a project that will generate opportunities for the Argal’s team in their evolution and professional and personal growth.”

According to the statement, Argal expects to generate €440m ($468.8m) in revenue for the 2023 fiscal year.

Luis Cerdan Ibanez, executive vice president of European operations at Smithfield, said the investment was aligned with the company's plan to boost its packaged meats portfolio in Europe.

Ibanez added: “Argal’s product quality, employees and management team makes this alliance a solid platform for our growth in Spain and Europe.”

Earlier this month, Smithfield’s US meat business announced the closure of its pork processing plant in Charlotte, North Carolina, which was expected to impact 107 employees.

Smithfield has been owned by China's WH Group since 2013, a business that is headquartered in Hong Kong.