NATIONAL AGENCY
OF INVESTMENT
AND PRIVATIZATION
REPUBLIC OF BELARUS
CONSORTIUM OF
MATTIG MANAGEMENT PARTNERS,
ALFA BANK BELARUS AND EGOROV,
PUGINSKY, AFANASIEV AND PARTNERS
Company profile:
OJSC “MINSK MARGARINE PLANT“
INVESTMENT
OPPORTUNITY:
The National Agency of Investment and Privatization of the Republic of
Belarus considers selling 94.096% of the share capital in Open JointStock Company “Minsk Margarine Plant” (“MMP” or the “Company”) to a
strategic investor in a renewed tender.
MMP is among the leading producers of margarine, mayonnaise and
refined oils and fat products in Belarus. The company has over 60 years
of history and enjoys strong brand recognition as well as stable market
shares for its products in the domestic market. Located in Minsk, the
capital of Belarus, the Company is actively trading throughout the whole
country and developing export markets.
The consortium of Mattig Management Partners, Alfa Bank, and Egorov,
Puginsky, Afanasiev and Partners, with World Bank support, is adviser
to the National Agency of Investment and Privatization of the Republic of
Belarus in carrying out the transaction through public tender.
The tender process is re-launched in May 2015. Tender Documentation,
including Information Memorandum, will be available to investors.
Shortlisted investors will be invited to carry out detailed due diligence
reviews at the Company.
THE COMPANY:
LOCATION:
Full Name
Open Joint-Stock Company ”Minsk Margarine Plant”
Industry
Production of margarine, mayonnaise, refined oils, fats,
spreads, ketchup, horseradish and mustard.
Established
1951
Shareholders:
94.096% state-owned; 5.904% physical and legal entities
General Manager
Aleksandr V. Shatilo
Employees
471 (as per Jan. 1, 2015)
MMP is located in the capital city of Minsk on 3.95 ha area, including 3.35
ha used on the basis of permanent right of use.
The site allows further expansion of production.
NATIONAL AGENCY
OF INVESTMENT
AND PRIVATIZATION
REPUBLIC OF BELARUS
CONSORTIUM OF
MATTIG MANAGEMENT PARTNERS,
ALFA BANK BELARUS AND EGOROV,
PUGINSKY, AFANASIEV AND PARTNERS
PRODUCTS and
CAPACITY:
MMP’s product range comprises over 60 products, mostly produced
under the trademark “Zolotaya Kaplya” and grouped under the following
main product categories:
• margarines – fat content ranging from 50% to 82%;
• mayonnaises – 19 types with differing fat contents (from 20% to 67%)
in various packs;
• culinary and confectionery fats – bulk and foil packed;
• vegetable oils – refined, deodirized and frozen-out sunflower oil;
unrefined sunflower oil; refined, deodorized rapeseed oil; flavored
rapeseed oil; blended rapeseed-sunflower oil; blended sunflower-olive
oil;
• spreads – “Lux” (82.5% butterfat); “Krestyanskiy” (72.5%),
“Domashniy” (50%), spread with chocolate flavor (50%);
• ketchups – “Ajika”, “Spicy”, “Classic”, “Barbecue”, “Tomato”, “Mild”,
etc.
• horseradish – “Belarusian Classic”, “Belarusian with Lemon”,
“Belarusian with Beet”, “Belarusian with Mustard”;
• mustard – savory, grainy, mild, mild with nuts;
• cheese product;
• mayonnaise-type sauces: mushroom sauce, mustard sauce,
“Belarusian with Horseradish” sauce, “Chinese” sauce, “Thousand
Islands”, tartar sauce.
The production process is carried out in compliance with ISO 9001:2007
and GOST national standards.
The plant has the following production capacity per main product category:
• margarine products – 13,700 tons per year (capacity utilization of
47.7% in 2014);
• mayonnaise, ketchup, horseradish and mustard products – 11, 280
tons per year (capacity utilization of 57.3% in 2014);
• refined packaged vegetable oils – 7,100 tons per year (capacity
utilization of 40.5% in 2014).
NATIONAL AGENCY
OF INVESTMENT
AND PRIVATIZATION
REPUBLIC OF BELARUS
CONSORTIUM OF
MATTIG MANAGEMENT PARTNERS,
ALFA BANK BELARUS AND EGOROV,
PUGINSKY, AFANASIEV AND PARTNERS
MARKET:
The Belarusian market for margarine, oils and fats is competitive and
lacks a clear market leader.
The market of refined oils has enjoyed positive dynamics over the last
years and has increased from 16.9 thousand tons in 2000 to 25.7
thousand tons in 2013. The consumption of bottled vegetable oils per year
averages 80-90 thousand tons, with sunflower oil being the preferred type
(80% of consumers). The growth potential is significant given the current
consumption levels of 15.9 kg of vegetable oil per capita compared to 45
kg per capita in the European Union.
The domestic demand for mayonnaise products is continuously rising,
with the market getting increasingly attractive for foreign producers and
importers. Mayonnaise imports have risen from 5,222 tons in 2012, to
6,762 tons in 2013 and 7,186 tons in 2014.
The margarine market has been steadily growing, with increased offering
from both domestic and imported production.
The market shares of MMP’s main product groups in the domestic
market are as follows:
2012
Market
Share
volume
MMP
‘000 tons
%
2013
2014
Market
volume
‘000
tons
Share
MMP
%
Market
volume
‘000
tons*
Share
MMP
%
Margarine
products
23,5
40,8
21
36,7
24,5
30,7
Mayonnaise
16,8
38,5
29,8
19,5
30,2
20,1
Vegetable oils
207,5
1,5
234,8
1,97
159,7
2,7
* Company estimates.
The main domestic competitors of the Company are:
• Gomel Fat Factory
• ABC
• Kamako
• Bobruisk Vegetable Oils Factory
The main international competitors are:
• Essen Production AG, Russia
• Unilever, Russia
• Oil Extraction Plant Yug Rusi,
• Creativ, Ukraine
Russia
• MJK JSC, Russia
• Ukrolya, Ukraine
• EFKO JSC, Russia
NATIONAL AGENCY
OF INVESTMENT
AND PRIVATIZATION
REPUBLIC OF BELARUS
CONSORTIUM OF
MATTIG MANAGEMENT PARTNERS,
ALFA BANK BELARUS AND EGOROV,
PUGINSKY, AFANASIEV AND PARTNERS
PRODUCTION AND
SALES:
Margarine had the highest share within the sales breakdown (tons) with
33.9%, followed by mayonnaise with 31.8% and bottled vegetable oils
with 15.6% (2014 data).
As a comparison, breakdown of sales per tons for 2012-2014 is presented
in the table below.
2012
2013
2014
2014
tons
tons
tons
share
6 368
5 706
5 990
31,8%
23
27
24
0,1%
1 151
825
913
4,8%
7 276
6 366
6 391
33,9%
657
332
276
1,5%
3 129
3 370
2 935
15,6%
Oil unpackaged
63
538
1 504
8,0%
Spread unpackaged
286
334
261
1,4%
Spread packaged
136
58
40
0,2%
Sauce
50
42
69
0,4%
Cheese product
101
81
61
0,3%
Horseradish
69
87
75
0,4%
Mustard
65
69
51
0,3%
Ketchup
303
293
255
1,3%
19 676
18 129
18 845
100%
Mayonnaise
Mayonnaise unpackaged
(bulk)
Margarine
Margarine unpackaged
Fat unpackaged
Oil
Sales Breakdown per category and tons,
2014, %
2%
1%
3%
5%
8%
15%
Total
34%
32%
Margarine
Oil, non-packaged
Margarine, non-package
Spread
Mayonnaise
Ketchup
Bottled oil
others
The consumer market (В2С) represents the main share of MMP’s sales
(67.4 % in 2014). Packaged margarine, mayonnaise and bottled oil
account for majority of sales.
60-70% of the production is sold in Minsk and Minsk region.
MMP is also exporting (less than 5% of sales) to the Russian market
(which is part of the Eurasian Economic Union of Belarus, Russia and
Kazakhstan) and has all necessary registrations for the Eurasian Economic
Union.
NATIONAL AGENCY
OF INVESTMENT
AND PRIVATIZATION
REPUBLIC OF BELARUS
CONSORTIUM OF
MATTIG MANAGEMENT PARTNERS,
ALFA BANK BELARUS AND EGOROV,
PUGINSKY, AFANASIEV AND PARTNERS
WORKFORCE:
The Company has a well-trained and motivated workforce. As of
01.01.2015 the total number of employees amounts to 471 persons.
The average wage at the Company for January 2015 amounted to BYR
6.5 million (or USD 451 per month).
FINANCIAL DATA (according to IFRS):
Financial results prepared according to IFRS are provided below (in USD thousand).
SELECTED BALANCE SHEET ITEMS:
Positions in ‘000
USD
2012
2013
9m 2014
Non-current assets
9 840
10 365
10 051
Current assets
7 677
8 934
Total assets
17 517
Share capital
SELECTED INCOME STATEMENT
ITEMS:
Positions in
‘000 USD
2012
2013
9m 2014
Revenue
33 585
30 409
20 428
7 671
Gross Profit
5 162
4 802
2 193
19 300
17 722
Operating Profit (Loss)
1 052
334
(389)
6 190
6 499
6 641
EBITDA
2 749
2 469
1 688
Total equity
15 085
15 881
15 765
Gross Margin
15,4%
15,8%
10,7%
Total liabilities
2 431
3 418
1 957
Operating Margin
3,1%
1,1%
-1,9%
Total equity/liabilities
17 517
19 300
17 722
EBITDA Margin
8,2%
8,1%
8,3%
NATIONAL AGENCY
OF INVESTMENT
AND PRIVATIZATION
REPUBLIC OF BELARUS
CONSORTIUM OF
MATTIG MANAGEMENT PARTNERS,
ALFA BANK BELARUS AND EGOROV,
PUGINSKY, AFANASIEV AND PARTNERS
CONTACTS:
Svetla Pehlivanova-Porenta
Director CEE, Mattig Management Partners
Tel. +43 1 504 83 98 11/Fax +43 1 504 83 98 15
E-mail: [email protected]
Sergey Mukhanaw
Deputy Team Leader, Privatization Advisory Services for Pool 3
(OJSC Minsk Margarine Plant and OJSC Konfa)
Mattig Management Partners-Alfa Bank-EPA&P Consortium
UE Volat Capital
Tel: +375 29 616 00 82
E-mail: [email protected]
Olga Rutkovskaya
Head of Privatization Department
National Agency of Investment and Privaitzation
Republic of Belarus
Tel. +375 17 200 05 49
E-mall: [email protected]
DISCLAIMER:
This document was prepared with the assistance of the National
Agency of Investment and Privatization of the Republic of Belarus
and OJSC “Minsk Margarine Plant” (the “Company”) and is based on
information and sources supplied by the Company which we believe
to be reliable but is not guaranteed to be complete and/or accurate.
The Consortium of Mattig Management Partners GmbH, CJSC AlfaBank, and LLC Egorov, Puginsky, Afanasiev and Partners shall not
consider any person or legal entity except the National Agency of
Investment and Privatization of the Republic of Belarus as its client in
this particular transaction. Potential investors are recommended to
consult their own advisers in all stages and aspects of the transaction.