Private equity manager Diligent Capital Partners (DCP) and Dutch entrepreneurial development bank FMO agreed to acquire a minority stake in Edinstvo Group, the leading independent producer of compound feed, packaged feed, premixes, concentrates, feed additives and distributor of veterinary drugs, animal vaccines, and pet goods in Ukraine.
Private equity manager Diligent Capital Partners (DCP) and Dutch entrepreneurial development bank FMO agreed to acquire a minority stake in Edinstvo Group, the leading independent producer of compound feed, packaged feed, premixes, concentrates, feed additives and distributor of veterinary drugs, animal vaccines, and pet goods in Ukraine.
Edintsvo Group operates 4 feed mills, as well as Inbel (Novacore), major premix plant in Ukraine. The $20 million investment will be used to construct a soybean processing plant, expand feed additives production capacity, and to install additional feed packaging lines. These projects are expected to reduce the company's production costs, increase the production of packaged feed, and create new jobs.
"I am proud of the hard work that the DCP and the Edinstvo Group teams undertook in reaching this important agreement and realizing this significant investment despite the uncertainty and economic turbulence of the last year. We are especially grateful to FMO for their support of DCP's investment strategy aimed at furthering the transformation of Ukraine’s agricultural sector from efficient production and export of raw agricultural commodities to further processing into higher value-added goods. Ukraine is one of the best regions in the world for production of food and we believe in investing in this segment.
The Edinstvo Group is an excellent example of the successful implementation of value-added processing that in turn supports additional value added activities in Ukraine, namely the production of animal proteins for both domestic consumption and export. The Edinstvo Group has ambitious plans for further development, and we are pleased to act as a financial catalyst for these initiatives" noted Dan Pasko, Co-Managing Partner of Diligent Capital
Roman Leschenko, Minister of Agrarian Policy of Ukraine, stated that this development confirmed the importance of quality investment to Ukrainian agriculture, which promotes introduction of modern technologies and proves trust of investors to the growth of agrosector in Ukraine. “Ukraine is interested to support sustainable development of agricultural sector with respect to the environmental challenges”, said Minister Leschenko and promised his support to this project.
“FMO looks forward to the cooperation with Edinstvo Group. As a development bank we aim to empower local entrepreneurs and we hope to contribute to the Group’s next phase. Together with our partner DCP, we aim to strengthen the company further and develop new segments with substantial value add and export potential, while at the same time creating new jobs,” said George Janssen - Senior Investment Officer, Private Equity, FMO.
"Cooperation with DCP and FMO marks a new stage in the development of Edinstvo Group. We are glad to have such reliable and experienced partners to support the implementation of our business plans. The investments will help us strengthen our market position, improve product quality and expand the range of goods with high added value. This will stimulate development of agricultural sector in Ukraine" commented Sergey Semenyachenko, Co-Founding shareholder and member of the Board of Directors of Inter Edinstvo Holding.
Vitaly Strukov, Managing Partner of BDO Corporate Finance and the exclusive financial advisor to Edinstvo Group, noted “Our cooperation with Edinstvo Group dates back more than ten years and began with the development of a long-term vision and strategy and the attraction of a significant loan from the EBRD to finance the first step of that strategy. Edinstvo Group belongs to the “top league” of feed and premixes producers in Ukraine and I am pleased that we were able to attract an equally strong and experienced partner as DCP to continue the realization of Edinstvo Group’s long-term strategy. "
The transaction was also supported by the leading professional advisory firms including Avellum, OMP, Eterna Law, Snark for legal, Deloitte for financial and tax, AVGroup for environmental and social, and Civitta for commercial due diligence.
