Not certain whether by horseflesh they meant flesh or bones/tendons etc. Nowadays it is not done (in the uk at least), but glue used to be made by boiling up animal bones and tendons, which would presumably have some flesh attached., which might include that of horses. Gelatine is still made in this way, though for gelatine only very clean "high quality" bones are used as it has to be as odourless as possible. For gluemaking all the really rancid, nasty bits were boiled. I can speak from personal experience that the odour of a glue factory was really obnoxious, even in the 1960s, as I once went for over a gelatine factory and a glue factory. Incidentally fish glues smell even worse. If the factory concerned was boiling actual flesh, rather than bones and rubbish, then i can anly assume it was for manufacture of animal food, or possibly fertilizer.
