AUGA group, AB subsidiaries sold 100% of the shares of Kooperatinė bendrovė "Grybai LT" to Akcinė bendrovė „Kauno grūdai“
July 21 2023 - 9:15AM
AUGA group, AB subsidiaries sold 100% of the shares of Kooperatinė
bendrovė "Grybai LT" to Akcinė bendrovė „Kauno grūdai“
On 7 June 2023, AUGA group, AB subsidiaries
Baltic Champs, UAB, UAB “AUGA Luganta“, Kooperatinė bendrovė
“AgroMilk“, Kooperatinė bendrovė “Juodmargėlis“ and Kooperatinė
bendrovė „Šventosios pievos“ (hereinafter the Seller) have signed
an agreement with Kauno Grūdai AB, controlled by Linas Agro Group,
(hereinafter referred to as the Buyer) concerning the sale of 100%
of the shares (hereinafter the Agreement) of Kooperatinė bendrovė
“Grybai LT“ (hereinafter the Company).
The Buyer and the Seller duly fulfilled all the
conditions stipulated in the Agreement to finalize the transaction.
On July 21, 2023, the parties signed a contract completion
document, based on which 100% of the Company's shares were
transferred to the ownership of Akcinė bendrovė “Kauno Grūdai”.
In total, the Seller received EUR 16,327,365.26,
including EUR 12,948,612.14 for the Company's shares and EUR 3 378
753,12 in repayment of a loan previously owed to Baltic Champs
UAB.
The price was calculated according to the
formula established in the Agreement, which was disclosed in the
announcement of AUGA group, AB on June 14, 2023 (you can access the
announcement here). Following the revision of the final financial
statements used for the calculation of the price, the price for
shares may be adjusted in accordance with the procedures set out in
the Agreement.
Please note that the Buyer did not apply to the
Competition Council for a concentration clearance, as the Company's
gross revenue in the Republic of Lithuania in 2022 did not reach
the threshold of EUR 2 million set out in Article 8 of the
Lithuanian Competition Law, from which it becomes obligatory to
notify a market share concentration to the Competition Council.
The Company produces organic ready-to-eat
products such as soups, canned vegetables, stews, and grain bowls.
The export geography covers 30 countries, including the the world's
leading organic markets, such as the United States, Germany, and
Japan. According to the data for 2022, the Company's revenue
accounted for 8.9% of the total revenue of AUGA group, AB, and its
subsidiary companies (hereinafter – the Group).
Consumers will still be able to find their
favourite soups, canned vegetables and other food products on the
shelves, but in the future these products will be branded not under
AUGA but different brand name. The parties have agreed on a maximum
transition period of 18 months during which the products can still
be marketed under the AUGA brand.
„We are delighted with the success of the
transaction and the fact that the profitable canned and
ready-to-eat products business, which we have developed from
scratch, will be continued by its new owners. We have sold this
business because it no longer fits with AUGA group's strategic
direction of developing agricultural technologies and providing
everyday consumer products with a lower environmental footprint.
The production of soups and other Grybai LT products required raw
materials that we cannot grow ourselves according to the AUGA
sustainability standard and thus achieve climate neutrality“, says
Kęstutis Juščius, CEO of AUGA group, AB.
Kęstutis Juščius notes that the Group will
continue to focus on the key strategic directions outlined in the
strategy, which include developing emission-reducing agricultural
technologies, expanding sustainable farming, and strengthening a
new category of more sustainable organic products. The raw
materials for the new products are exclusively grown in farms that
adhere to AUGA's sustainability standard. The AUGA product line,
labelled as "mission with no cost to nature," includes dairy and
grain products, as well as eggs. The Group plans to expand the
existing assortment and offer consumers even more products made
from more sustainable raw materials, while also developing the
supply of such materials to food processors. The Group's basket of
end-consumer-products also includes organic oatmeal, fresh
vegetables, and fresh mushrooms grown by Baltic Champs, UAB.
"We have proven that we can successfully create
new businesses and enter new foreign markets. I believe that with
the experience we have gained and by concentrating our workforce
and capital, we will be able to successfully develop the strategic
businesses we are now focusing on. In the end-consumer-products
market, we are now targeting much larger categories than before.
Our goal is to export not just products, but sustainable
agricultural technologies and produce more sustainable food in
collaboration with farmers around the world," says Kęstutis
Juščius.
The completed transaction will significantly
improve the Group's results for 2023 and increase the consolidated
profit of AUGA group, AB by approximately EUR 7-8 million.
The Group plans to use the proceeds obtained
from the transaction for general corporate purposes, partial
coverage of obligations, augmentation of the working capital, or
financing projects approved in the strategy.
The final decision on the use of the proceeds
will be made by the Group's management in the third quarter of
2023, after this season's harvest is completed. As mentioned in
previous releases, the Group plans to raise new capital and
additional funding for the development and expansion of the
technology branch.
Chief Executive OfficerKęstutis Juščius+370 5 233 5340
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