BaltCap Private Equity Fund III (BPEF III) has completed the acquisition of the largest Lithuanian meat processing companies Krekenavos Agrofirma and Mėsa LT.
BPEF III has financed acquisition of Krekenavos Agrofirma through Mesa LT and became majority owner of the joint company. Linas Grikšas, CEO at Krekenavos Agrofirma participated in the transaction by acquiring minority stake. The transaction has been cleared by the Competition Council in March this year. This is the first investment by EUR 126 million BPEF III fund which has been established by BaltCap in 2019.
“This is a classical BaltCap deal fully in line with the fund’s “buy-and-build” strategy. We are investing in a sector with a great potential for consolidation and a company with the ability to grow into a regional champion,” said Šarūnas Alekna, partner at BPEF III fund. “We’re partnering with a professional management team, which has demonstrated ability to sustain business integrity and adapt to changing environment even in the face of global crisis. The deal has been closed despite the COVID-19 related lockdown and I believe it transmits positive message to the whole market that life does not cease,” Alekna added.
Linas Grikšas, the CEO of Krekenavos Agrofirma, noted that COVID-19 pandemic had affected the food industry less than other sectors, however disrupted supply chains and changing consumer preferences bring challenges for the entire industry. “”In the right place at the right time” is a very appropriate saying for this transaction. I am sure that the long-term experience and professional know-how of the BaltCap team will lead us to further growth. It is important to have a reliable partner when facing the challenges in the new reality,” Grikšas commented.
AB Swedbank provided the loan of EUR 16 million for the acquisition and refinancing of existing liabilities. Antanas Sagatauskas, Head of Corporate Banking at Swedbank, says that even in a turbulent time the bank strives to support and strengthen Lithuanian businesses. “We are happy to play a major role in financing the acquisition of one of the largest and most important meat processing companies in Lithuania. It is important that an agreement has been reached in quite a complicated period for Lithuania and the whole world,” Sagatauskas said.
TGS Baltic acted as a legal advisor for BaltCap.
Krekenavos Agrofirma recorded sales revenue of EUR 122 million last year and has a net profit of EUR 4.7 million. Mėsa LT’s revenue in 2019 amounted to EUR 0.7 million.
BaltCap Private Equity Fund III (BPEF III) invests in innovative companies in the Baltic and Nordic countries following buy-and-build strategy. BPEF III was established in co-operation with European Investment Fund (EIF), the European Bank for Reconstruction & Development (EBRD), the Nordic Environment Finance Corporation (NEFCO), LHV pension funds, SEB pension funds from Estonia, Latvia and Lithuania, eQ Asset Management and also family offices. EIF has invested through Baltic Innovation Fund 2 (BIF 2, an initiative created by cooperation between the Republic of Estonia, the Republic of Latvia, the Republic of Lithuania and EIF) and EIF’s investment in BPEF III also benefits from the financial backing of the European Union under the European Fund for Strategic Investments (“EFSI”) set up under the Investment Plan for Europe. The purpose of EFSI is to help support financing and implementing productive investments in the European Union and to ensure increased access to financing.
Krekenavos Agrofirma is one of the largest agricultural companies in Lithuania with more than 20 years history in the business and one of the largest and most modern meat processing plants in the Baltic States. The company is located in Mantviloniai village, Kėdainiai district and has an area of more than 20 thousand sq. m. It is a growing company continuously improving and investing in the latest production technologies, new equipment, as well as the systematic improvement of work safety and competence of employees. Mėsa LT holds several well known brands in meat category.
Partner, BaltCap Private Equity Fund III
Phone: +370 6868 9242