Agri Europe (f.MK Equity)

Translated version of this PSD: Serbian

Project Description

EBRD is considering an equity investment in the amount of up to €50 million in Agri Europe (the “company”), a vertically integrated agribusiness company with its core business in primary agricultural production, agricultural commodity trading, sugar production and trade.

The proposed equity would enable the further consolidation of Agri Europe’s agribusiness operations over the medium term through investments in operations to achieve better operational productivity, and provide working capital financing.

Transition Impact

Key sources of transition impact derive from:

i) setting standards of corporate governance – the Bank’s equity investment will help to streamline the group structure and improve corporate governance standards ahead of an intended IPO;

ii) market expansion – the construction of silos with third party access in Serbia will address one of the key infrastructure bottlenecks in the country;

iii) demonstration of new financing methods – opening up to outside financial investors may have a key signal effect to other private companies in the region. This also applies to the IPO, which would demonstrate the feasibility of such a step to other similarly structured private companies.

The Client

The company consolidates: MK Group (Serbian producer and trader of agricultural commodities), Carnex (leading Serbian meat producer), Sunoko (leading Serbian sugar producer and exporter) and AgroInvest (Ukrainian subsidiary engaged in primary agricultural production). The company’s grain collection and trading activities are supported by its strong agri-infrastructure consisting of substantial storage capacity and transport fleet.

EBRD Finance

Equity investment in the amount up to €50 million.

Project Cost

Up to €50 million

Environmental Impact

The project was categorised B following the due diligence undertaken by a staff member from EBRD’s Environment and Sustainability Department as well as subsequent meetings with key management to review the Company’s environmental and health and safety management systems. Based on the due diligence an Environmental and Social Action Plan (ESAP) was developed to ensure the company's compliance with the Banks Performance Requirements for environment, health and safety and labour. The company will provide the Bank with regular reporting on the implementation of the ESAP and EBRD staff will monitor Environmental and Social performance for the lifetime of the project.

Technical Cooperation

None

Company Contact

Vladimir Gavric, CFO of MK Group
Tel: + 381 11 35 39 503
Email: vladimir.gavric@mkgroup.rs

 

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