FDBusiness.com

Cherkizovo Group to Acquire NAPKO

 Breaking News
  • Diageo Launches New Super-premium Gin Diageo is introducing a new super-premium Italian gin, Villa Ascenti. The launch comes at a time when the super-premium and ultra-premium gin categories are the fastest growing segment within gin in Europe. Villa Ascenti will initially be available in 14 European countries. A new €420,000 (£360,000) distillery has been built on the site of the brand [...]...
  • European Commission Proposes to Increase Price Transparency in the Food Chain Having banned unfair trading practices and improved producer co-operation, the European Commission has presented the third element to improve fairness in the food supply chain by introducing greater transparency in the way prices are reported throughout the chain. The European Commission has tabled a proposal that will make available crucial information on how prices are determined [...]...
  • Irish Distillers Launches ‘A Story of Irish Whiskey’ Podcast Series Irish Distillers, Ireland’s leading supplier of spirits and wines and producer of some of the world’s most well-known and successful Irish whiskeys, has launched its first podcast, ‘A Story of Irish Whiskey’. Produced by Last Cast Media, the five-part series is a story of coming together, sharing, conquering markets and how three families, competitors for [...]...
  • C&C Group Increases Revenue by 187.3% to over €1.5 Billion C&C Group, the UK and Ireland drinks production and distribution business, increased net revenue by 187.3% to €1.575 billion in 12 months ended 28 February 2019, reflecting the acquisition of Matthew Clark and Bibendum from the administrators of Conviviality Group in April 2018. Excluding Matthew Clark and Bibendum, and on a constant currency basis, net [...]...
  • 2 Sisters Accelerates Business Transformation 2 Sisters Food Group has announced a series of actions as part of its accelerating transformational strategy to turnaround the business. The company is making further investments in its UK Poultry and Fox’s Biscuits businesses, and is proposing to reduce the number of its UK Poultry sites in order to produce shorter, more efficient supply [...]...

Cherkizovo Group to Acquire NAPKO

Cherkizovo Group to Acquire NAPKO
April 11
12:13 2017

Cherkizovo Group, the largest vertically integrated meat and feed producer in Russia, is acquiring NAPKO, one of Russia’s leading grain producers.

Among other assets, Cherkizovo Group will acquire NAPKO’s agricultural land of 147,000 hectares located in the Lipetsk, Tambov and Penza regions, which are strategically important areas for Cherkizovo Group. In 2016, NAPKO produced 250,000 tons of grain. Following the acquisition, Cherkziovo Group’s total operating land bank will reach 287,000 hectares. As part of the transaction, the Group will also acquire the supporting production infrastructure to cultivate the land and store the grain.

Sergey Mikhailov, chief executive of Cherkizovo Group, comments: “While organic growth remains our priority, this acquisition represents an excellent example of the strategic M&A opportunities we are ready to explore to further strengthen our vertical integration, supply chain and business model generally. By extending our land bank we will increase our self-sufficiency in grain and focus on synergies and efficiencies to reduce our unit production costs. Following this acquisition, we expect to increase our self-sufficiency in grain to 60% in the next few years from 30% at the end of 2016.”

NAPKO has been one of Cherkizovo Group’s most trusted business partners for a number of years, with the group buying approximately 9-11% of its grain from NAPKO each year. NAPKO’s land bank complements Cherkizovo both in terms of geography and the types of crops cultivated, which include wheat, corn, sunflower and peas. All the acquired assets will be integrated into Cherkizovo’s grain farming segment and NAPKO’s existing management team and employees will be retained.

The acquisition will allow Cherkizovo to reduce its exposure to grain market volatility, including possible grain shortages, local currency volatility and changes to grain suppliers’ pricing policies. NAPKO generates positive cash flow and has a relatively moderate level of debt servicing.

Cherkizovo will pay in cash RUB5 billion (€82 million) for NAPKO’s equity and assume NAPKO’s net debt, which stood at RUB751 million as of March 31, 2017. The transaction is expected to be finalized within the next 30 to 60 days.

About Author

mike

mike

Related Articles



Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • June 18, 2019Multimodal 2019
  • June 25, 2019BevExpo 2019
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber

Subscribe Here



Advertisements