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Thursday, 04 July 2013 00:00

Lithuania's Linas Agro Group wants to buy Kekava, Lielzeltini, Broileks and Cerova for EUR 12.5 million Featured

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Lithuania's Linas Agro Group wants to buy Kekava, Lielzeltini, Broileks and Cerova for EUR 12.5 million www.ir.lv

Lithuanian company "AB Linas Agro Group" has signed agreements on buying 87 percent of shares in the joint-stock poultry company "Putnu fabrika Kekava" (Kekava), 100 percent shares in "Broileks", 100 percent shares in "Cerova" and 100 percent shares in "Lielzeltini"; the deal is to be finalized by December, depending on many conditions, including the Competition Council's permission.

"Linas Agro Group" is planning to spend EUR 12.5 million (LVL 8.78 million) on the shares, and it expects the four companies' aggregate turnover to reach approximately EUR 70 million or LVL 49 million in the future.

"The main business of companies "Kekava", "Broileks", "Cerova" and "Lielzeltini" is broiler and poultry meat production. We are planning to buy all these companies together. Poultry farming has good prospects and is a potentially profitable sector, even though part of the companies we wish to buy will have to be restructured," says "Linas Agro Group" board member Andrijus Pranckevicius.
The deal will make it possible for "Linas Agro Group" to diversify its operations and start to sell products with higher added value.

"After the deal is concluded, we are planning to vertically integrate the acquired companies, ensuring poultry feed production, egg incubation, poultry growing and meat processing. The business lines of the companies we plan to acquire overlap with the operations of "Linas Agro Group" to some extent, therefore providing additional synergies. We sell about 1.5 million tons of grain and other agricultural produce a year, part of which we will be able to use in production of compound feed in Latvia," said Pranckevicius.

As reported, "Kekava" has been involved in a lengthy dispute with "Nordea" bank and other creditors.

Source: LETA

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