Saudi Arabia's SALIC acquires Mriya farming company
The Saudi Agricultural & Livestock Investment Co. (SALIC), which core business is investment in agriculture, is acquiring the Ukrainian Mriya farming company.
Ukrainian President Petro Poroshenko announced the deal at a meeting with representatives of Saudi Arabia in Kyiv on Wednesday.
"I would like to dwell on the issue that the decision of SALIC to acquire Mriya farming holding is an extremely important event and it shows the readiness of investors to invest money in Ukraine and fundamental changes in the investment climate, as well as the attitude of investors to our state," the president said.
Poroshenko pointed out the uniqueness of the event, as the acquisition contract is the largest in the agricultural sector in the history of Ukraine.
"SALIC belongs to the Sovereign Fund of Saudi Arabia. Today it is one of the largest investors in the agricultural business around the world. The decision to come to Ukraine is a very vivid evidence that our country is ready to accept such investors and has created all the conditions for this," the head of state said.
He also said that the contract involves the purchase of Ukrainian assets, not land. This will help increase the level of investment in the agricultural complex, the level of technology, yields, exports, the foreign exchange income in Ukraine and the creation of high-paying jobs.
"We have agreed that this is the beginning of an unusual process, when the volume of investments to Ukraine, including from SALIC and the Sovereign Fund, will grow," Poroshenko said.
According to him, the decision on the deal was made in the shortest possible term - about one year.
According to a posting on the website of the Mriya company, Mriya Farming Plc (the U.K.) and SALIC UK Ltd. (Saudi Agricultural & Livestock Investment Company, the U.K.) entered into a share purchase agreement for the sale to SALIC of the Mriya group's Ukrainian farming assets, including infrastructure facilities, machinery, and companies owning land lease agreements.
The value and terms of the transaction have not been disclosed. Completion of the transaction is subject to approval from the Antimonopoly Committee of Ukraine and other customary closing conditions.
"Upon completion of the deal, Mriya will continue its operations in Ukraine alongside SALIC's subsidiary, Continental Farmers Group (CFG)," the company said.
"Our subsidiary, CFG, has successfully operated in Ukraine since 2006, farming 45,000 hectares in Lviv and Ternopil regions... Considering the positive experience of investing in the Ukrainian economy, SALIC UK decided to expand the business and thoroughly studied the Ukrainian agricultural market in search of new opportunities… Key to the ethos of SALIC UK is identifying, acquiring and operating long term, profitable and sustainable agribusiness investments… Today's acquisition of Mriya fits very well into SALIC UK's investment criteria and much needed post acquisition investment will secure the long-term profitability of this excellent asset," Chairman of SALIC UK Khaled Alaboodi said.
CEO of CFG Mark Laird said that his company the next two years plans to significantly invest into new equipment, infrastructure, agricultural technology and land bank consolidation as well as work closely with the local management to build the combined Mriya and CFG operations into a World Class farming operation.
Mriya's advisors in the deal and creditors in the debt restructuring process were Rothschild & Co (France), ICU, FinPoint (both - Ukraine), as well as the law firm Hogan Lovells (the U.K.).
Mriya Agro Holding is a vertically integrated agro-industrial holding founded in 1992 by Ivan Huta. Today, its land bank is 165,000 hectares. The capacity of its silos and grain storages is estimated at 380,000 tonnes.