News update:Mar 9, 2016

MHP to expand production of feed through acquisition

Antimonopoly Committee of Ukraine has issued the approval for poultry producer and agricultural complex MHP to conduct acquire the assets of Agrokultura Company with the target being to purchase 68,700 ha of agricultural land. It is expected that the purchase will let the company expand its production of feed crops: wheat, corn and soy for its poultry farms.

"We are in negotiation, but no certain agreements have been signed so far" commented CEO of Agrokultura Elizabeth Potter. The spokesperson of MHP Anastasya Sobotuyk also confirmed the intention of the company to conclude the acquisition agreement. "We are interested in purchasing the [assets] of Agrokultura" she added.

The negotiation will be concluded soon

The deal will let MHP expand its land to almost 400,000 ha. The agricultural lands which are the subject of the deal are located in the Lviv, Ivano-Frankivsk and Ternopil Oblast of Ukraine close the main poultry farming capacities of MHP in Vinitsia Oblast. Market experts say that there is high possibility that the deal will be concluded, as Agrokultura has already been looking for a buyer for its assets for some time now.

Agrokultura, just as the predecessors of this company, failed to make a profitable business out of their assets. It is obvious that she has some financial difficulties, and the sale of certain assets could help it to solve them" commented Alexander Couple, head of the analytical department of the investment bank Concorde Capital, adding that the cost of the assets of the company in Ukraine is about US$ 25-30 million.

Noteworthy, that in the past few years, the company was selling part of their land in Russia and declared its intention to get rid of the Ukrainian agricultural lands.

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