€214 Million Investment in Food Union Group
Food Union Group, an international group of dairy and ice cream producing companies with a strong market share in Northern Europe and Latvia, has received a combined €214 million (US$225 million) investment from PAG, one of Asia’s largest private equity firms, and Meridian Capital, an existing investor.
Food Union’s businesses include milk processing as well as ice cream manufacturing in Northern Europe. PAG and Meridian Capital’s investment will support the expansion of Food Union with a specific focus in China, where Food Union is near completion on two modern dairy plants. In addition to capital, PAG will provide Food Union with deep country-specific knowledge and significant operational experience in support of the management team. PAG will invest €161.6 million and Meridian Capital will invest a further €52.4 million into Food Union.
“Food Union has had a tremendous year in 2016. In Europe, we have solidified our position in our home markets and have acquired two ice cream producers in Norway and Romania,” says Andrey Beskhmelnitsky, global chief executive and founder of Food Union Group. “In China, we broke ground on two modern dairy plants which are expected to bring high-end dairy products to Chinese consumers by the beginning of 2018. PAG’s investment and Meridian’s follow-on investment are an endorsement of Food Union’s strategy and we look forward to working with PAG to build a strong business of dairy products in China.”
“We are delighted to have the opportunity to partner with Food Union and Meridian Capital to help build a business to bring the best dairy products to China. There is a great demand among increasingly affluent and discerning Chinese consumers for high quality protein foods such as those Food Union produces. With its technology, knowhow and capabilities, Food Union is uniquely positioned to deliver what the Chinese market needs,” says Weijian Shan, chairman and chief executive of PAG.
“Entry into China, which has one of the largest and fastest growing consumer markets in the world, is a significant step for Food Union,” remarks Askar Alshinbayev, managing partner of Meridian Capital. “We are confident that working alongside with PAG, we can deliver on our strategy to manufacture European quality dairy products which demanding Chinese consumers can enjoy and trust.”
In Europe, Food Union Group will continue focusing on high added value product development and production in dairy and ice cream segments and strengthening its market positions in the Baltics, Nordics, Central Eastern Europe and CIS countries, as well as expanding its export prospects in Middle East and China.
Currently employing more than 2,500 people, Food Union Group incorporates dairy and ice cream producing companies operating in nine countries. The group unites major dairy and ice cream companies and sales offices in Northern and Central Eastern Europe: “Rīgas piena kombināts”, “Valmieras piens”, and “Rīgas Piensaimnieks” in Latvia, “Premia” in Estonia and Lithuania, “Premier Is” in Denmark, “Isbjorn Is” in Norway, “Alpin57Lux” in Romania, “Hladokombinat No.1” in Russia, “Ingman Ice Cream” in Belarus, and two dairy production facilities currently under construction in China. Currently Food Union Group is the leading milk processing company in Latvia and the largest ice cream manufacturer in the Baltics and Denmark.
Food Union Group exports to 25+ countries all over the world, with the main markets being Latvia, Lithuania, Estonia, Poland, the Netherlands, Great Britain, Azerbaijan, Russia and China.
