Tambov Turkey LLC, a joint Russian-Spanish venture created by Cherkizovo Group and Grupo Fuertes for the construction of a vertically integrated turkey meat production plant in the Tambov Region, attracted RUB 1.2 bln as part of the first tranche of the line of credit. Sberbank CIB organised financing, which was announced in February of this year. The total investment in the project amounts to RUB 7.5 bln (including VAT), of which more than RUB 3 bln is a joint investment by Grupo Fuertes and Cherkizovo Group, the remainder is long-term loan financing.
Sergei Mikhailov, Cherkizovo Group CEO, commented: “Two years ago a unique international agribusiness investment project was launched: with the help of Sberbank of Russia and the Tambov Region Administration we were able to seamlessly combine the many years of international experience of our Spanish partners and Cherkizovo Group’s experience in implementing major investment projects in Russia. We anticipated demand for a broader and more diverse range of poultry products and next year will begin providing consumers with high-quality locally produced turkey meat.”
Dmitry Sredin, Senior Banker of the Client Management Department, Managing Director at Sberbank CIB, said: “We are delighted that thanks to the financial support from Sberbank, this major high-tech agricultural project is being carried out in Russia using a significant amount of foreign investment and the many years of experience of the Cherkizovo Group and its foreign partner. When preparing the lending deal the bank took into account the specifics of the client’s business, its reliability, and also the project's scale and potential. This is why even in the current challenging market conditions, we are providing long-term financing for up to eight years and looking forward to extending cooperation with our partners. On the whole, Sberbank takes a rather flexible approach to its product offerings, which enables us to take into account specific financial needs of companies from various sectors of the economy.”
Grupo Fuertes President Tomás Fuertes commented: “Grupo Fuertes is increasing its presence in international markets. In Russia, we have partnered with the country’s leaders in finance and agriculture. We are building a company that will be efficient, competitive and environmentally friendly. We will have everything that is required to provide consumers a great product.”
Currently Cherkizovo Group and Grupo Fuertes are constructing several major facilities, including an incubator with an output of 5.9 million eggs per year, a feed mill capable of producing 150,000 tonnes of fodder per year and housing 120,000 tonnes of grain, four rearing areas that have four units each, sanitary checkpoints, and modern warehouse complexes. The Tambov Turkey project will have an output of over 40,000 tonnes of turkey meat per year (dressed weight).
About Cherkizovo Group
Cherkizovo Group (LSE:CHE, MOEX:GCHE) is the largest meat manufacturer in Russia and one of the top three companies serving Russia’s poultry, pork and meat processing markets. The company is also Russia’s largest producer of fodder. The company’s most well-known brands are Petelinka, Kurinoe Tsarstvo and Mosselprom. 63% of the Cherkizovo Group is controlled by CEO Sergei Mikhailov and the members of his family; 37% of the Group’s shares are quoted on the LSE and the Moscow Exchange.
Due to its vertically integrated structure, which includes agricultural land, grain storage facilities, feed production, livestock breeding, growing and slaughtering as well as meat processing and integrated distribution, Cherkizovo has consistently delivered sustainable revenue and profit growth. In 2013, Cherkizovo’s consolidated revenue exceeded $1.6 billion, and Cherkizovo produced more than half a million tonnes of meat and processed meat products.
Cherkizovo’s strategy includes both organic growth and investment in new projects, driving the consolidation of the Russian meat market. In the past five years alone Cherkizovo Group has invested over $1 bln in the development of Russia’s agriculture sector.
Cherkizovo Group Communications and Investor Relations
Tel: +7 495 788 3232 ext. 15019
The Corporate & Investment Banking Business (Sberbank CIB) was created as part of the integration of Sberbank of Russia and Troika Dialog. Sberbank CIB’s key areas of activity are corporate finance (including trade finance), the documentary business , investment banking services, trade operations with securities, and private equity. Sberbank of Russia’s Corporate & Investment Banking Business provides integrated financial solutions and investment advisory services to its clients, which include major corporations, financial institutions, sovereign states and federal and sub-federal government bodies and organisations.
Sberbank CIB Press Service
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