June, the 27th, 2008
Atria to expand in Estonia through aquistion of teo meat processing companies.
Atria will boost its growth in Estonia by acquiring meat processing companies AS Woro Kommerts and AS Vastse-Kuuste Lihatööstus. The deal covers 97.7% of the AS Woro Kommerts stock. The companies are well-known manufacturers of a variety of high-quality meat products and consumer-packed meat. Through these acquisitions, Atria will complete and expand its current product range for retail customers in Estonia.
Established in 1993, AS Woro Kommerts is a company specialising in the production of meat products. Woro's product portfolio includes smoked sausages and meat products, cooked sausages, grill sausages and frankfurters. The company's total market share in terms of value is 13% (source: AC Nielsen 2008),
which makes it Estonia's second largest meat processing company. In recent years, Woro has been investing actively in the development of product quality and brands. In 2007, it posted net sales of EUR 9.9 million and employed some 170 staff. The company has a production plant in Ahja, near Tartu and a distribution centre in Tartu. Built at the turn of the century, the production plant boasts modern production machinery.
AS Vastse-Kuuste Lihatööstus manufactures a range of cold cuts, sausages, dried sausages and consumer-packed meat. The company has its own slaughterhouse and cutting plant. Founded in 1994, Vastse-Kuuste reported net sales of EUR 8.8 million in 2007. Its total market share in terms of value is 6% (source: AC Nielsen 2008), and it employs approximately 140 people. In recent years, Vastse-Kuuste has been investing in the modernisation and capacity increase of the production plant. Its market position has also strengthened due to the new investments. The company has a particularly strong position in cold cuts in the Estonian market. The production plant is located in southern Estonia, in Vastse-Kuuste.
In 2005, Atria acquired Estonian meat processing company AS Valga Lihatööstus, whose net sales for 2007 were EUR 23.2 million. Combined with the operations of Woro and Vastse-Kuuste, AS Valga Lihatööstus is going to be the second largest player in the Estonian meat processing market, with net sales of approximately EUR 42 million. The combination will generate significant synergies and help establish a firmer foothold in the market.
In 2007, Atria invested roughly EUR 7 million in increasing the capacity and cost-efficiency of the Valga production plant, and in developing primary production. Furthermore, Atria has heavily invested in product development and marketing. Through its new acquisitions, Atria will create good conditions for growth both in Estonia and throughout the Baltics.
The closing of the deal is subject to the approval of the Estonian competition authorities. This is anticipated to take place by the end of July. Atria estimates that the process of consolidating the new companies will begin on 1 August 2008. The parties have agreed not to make the purchase price public.
For more information
Mr Matti Tikkakoski, President & CEO
of Atria Plc, tel. +358 50 2582.
Helsinki Stock Exchange
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