Cherkizovo Group agreed on purchase of a sausage production facility in Leningrad region

February 15, 2021

Moscow, Russia – February 15 – Cherkizovo Group (MOEX: GCHE), the largest meat producer in Russia, reached a preliminary agreement on purchase of a meat processing company LLC “Pit-Product” (Pit Product brand) from Finnish Group Atria. The transaction will let Cherkizovo increase its share in the sausage market in the North-West Federal District, one of the key regions of the company`s presence.

A preliminary agreement on acquisition of 100% of shares in LLC “Pit-Product” was signed by LLC “APK Mikhailovsky” (a part of Cherkizovo Group) with the current owner of the company – Atria Group (Finland). Pit-Product owns two modern meat processing production facilities in Leningrad region (in Gorelovo and Sinyavino) with the capacity of 39 000 tons of sausages, hot dogs, meat deli per annum. Among the clients of the company are federal retail chains and food service establishments.

Total headcount of LLC “Pit-Product” is around 700 people (as of the end of 2020). Along with the production sites, the transaction will also include logistics facilities, Pit Product brand and other intellectual property rights.    

The transaction is expected to be closed in the first half of 2021, after approval by the Federal Antimonopoly Service.

“Increase of value-added products manufacturing remains of the most important priorities in Cherkizovo Group`s development. For that reason, acquisition of “Pit-Product”, one of the most technologically advanced processing facilities in the North-West Federal District, will significantly reinforce our positions in such an important and big market. The transaction will also contribute to further increase of sales in the food service channel”, comments CEO of Cherkizovo Group Sergey Mikhailov.

goetzpartners acts as exclusive financial advisor to Cherkizovo Group in the acquisition of LLC “Pit-Product”. Legal support of the transaction is provided by Eversheds Sutherland. Financial and tax due diligence is conducted by Deloitte.