“Expansion in the export markets and increase of our exports have been a strategic goal for almost 10 years. During this period, we have made targeted investments and developed production facilities in Latvia to offer our products locally and meet the external demand. Last year, Dobeles dzirnavnieks AS exported 68% of its products. It was just logical to look for possibilities to increase our production capacity to compete in the global market and satisfy customer needs in markets where delivery deadlines and volumes were challenging,” explains Kristaps Amsils, Chairman of the Board of Dobeles dzirnavnieks AS.
K. Amsils notes that the company highly values the experience, team and whole brands portfolio of Baltic Mill, as the companies of this group have always been very proud of their quality: “We are happy to strengthen our group with such a strong player from Lithuania. We believe that after the implementation of the strategic investment plan, production in Lithuania can be developed to the same extent as the production of Dobeles dzirnavnieks is growing.
Baltic Mill Group owns one of the largest and oldest mills in Lithuania, UAB Malsena Plius, as well as pasta production company Amber Pasta and other grain processing companies in the Baltic States. The majority of 64.75% of Baltic Mill's shares have so far belonged to the private equity fund Amber Trust II S.C.A. In four production factories, the group processes over 150 thousand of tons of grains per year.
“Attracting investments from such a strong and reliable market participant as Dobeles dzirnavnieks is very good news for the entire Baltic Mill Group and our partners, suppliers and Lithuanian farmers. By maintaining the cherished Lithuanian values and the quality ensured during the long years of operation, the group companies will also receive a solid investment foundation for successful growth. It is very important for us that investors appreciate and support the strengths of Baltic Mill companies, the importance of Lithuanian values, plan to maintain those values and increase local production capacity,” says Vygantas Reifonas, Head of the Baltic Mill Group.
According to V. Reifonas, in order to compete successfully, it is important today to be a strong player not only in home markets, but also in the whole region. This partnership between the two food businesses will help to ensure a competitive advantage in Europe and enable consumers to offer even more high-quality products in both the domestic and export markets. And that also means more stability for local farmers and group employees.
After the acquisition, Dobeles dzirnavnieks plans to invest in upgrading and expanding the production facilities of the Lithuanian grain processor that will allow to increase the production volume and provide a sizeable contribution to strengthening the export capacity of the group.
During the last 10 years Dobeles dzirnavnieks has invested more than EUR 120 million in development of its infrastructure and production capacities. This year, by investing more than EUR 30 million the company completed two key investment projects: the first Baltic full-cycle organic grain processing infrastructure and installation of an innovative pasta production line.
By the statutory deadline, reports will be submitted to competition councils of all three Baltic States, and the sale will be completed after their review and approval. It is expected that the acquisition will be completed by the end of this year.
Baltic Mill was represented by law firm Ellex Valiunas, Dobeles dzirnavnieks was represented by Spīgulis & Kukainis.
About Dobeles dzirnavnieks AS
Dobeles dzirnavnieks AS is the largest grain processing company in Latvia. Its main products include all types of wheat flour, semolina, flour mixtures, pasta, cereals, groats, and animal feed. For more information, see www.dzirnavnieks.lv.
About AB „Baltic Mill“
Baltic Mill AB Group directly owns several grain processing and food production companies in the Baltic States: one of the oldest and largest mills UAB Malsena Plius, pasta production company Amber Pasta in Lithuania, Rīgas dzirnavnieks AS in Latvia and Balti Veski AS in Estonia. In the financial year of 2020, the group's revenue amounted to 56.7 million euros and the net profit for the year amounted to 801 thousand euros.
