Specialist retail meat packing business Hilton Food Group plc has signed a long-term supply agreement with Tesco Central Europe to produce fresh food. The five-year deal involves building a state-of-the-art factory in Poland to produce items including sandwiches, pizza, ready meals and soups. Hilton says that this requires an investment of €6 million (US$7.3 million) in plant and equipment, as well as the construction of the factory itself.

Production is expected to begin in the first quarter of 2019. 

Hilton and Tesco have also agreed to sign a further five-year supply agreement for Hilton to continue servicing Tesco’s Central European stores with pre-packed meat. 

“We have a long and successful history of working with Tesco, one of the world’s biggest retailers. This agreement represents an opportunity to enter a growing food segment of the market,” says Hilton Chief Executive Robert Watson OBE.

“We look forward to seeing the positive effect our tried and tested business model will have on this relationship, which will be supported by our flexible and versatile approach to meeting local requirements.”

“We continue to look for further opportunities for geographic expansion,” Matt Simister, Tesco Central Europe CEO, adds.

“I’m delighted that we are extending our deep Group-wide partnership with Hilton to bring new manufacturing investment and capability to Poland. Our collective experience and expertise will bring new, innovative and high quality fresh and convenient products to our customers in Central Europe.”

Hilton Foods, which also has supply deals with Ahold, ICA, Coop Danmark and Sonae in Europe as well as Woolworths in Australia, had sales of £1.2 billion (US$1.5 billion) in 2016 and employs around 3,000 people across its sites.