Grupo Corporativo Fuertes S.L. of Spain has acquired a 5.06 percent share of Russian-based Cherkizovo Group after buying shares in the open market, reports Reuters.
Grupo Corporativo Fuertes S.L. is one of Spain’s largest agricultural holdings, with an annual revenue of more than EUR1.4 billion (US$1.5 billion) and more than 6,000 employees. PJSC Cherkizovo Group is Russia’s largest meat and feed producer.
The total representation of Grupo Corporativo Fuertes S.L. has an approximate valuation of US$30 million.
“We started looking for a strategic partner in Russia 10 years ago,” said Tomás Fuertes, president of Grupo Fuertes. “Four years ago, we chose PJSC Cherkizovo Group because we spoke the same business language: long-term goals, leadership ambitions, quality, transparency, modernization. Both of our companies grew into agro-industrial holdings from small family companies, with strong traditional values and passion for agriculture.”
“We are honored that our long-term strategic partner has decided to acquire a substantial stake in our company at the time when Western companies have pulled back their investments and are cautious about the future growth of the Russian market,” said Sergey Mikhailov, CEO, PJSC Cherkizovo Group. “We are indeed the largest vertically integrated agricultural holding in Russia. We are a company that has grown out of strong family traditions into a leader in innovations and efficiency. We adhere to world class standards in corporate governance and financial reporting. I believe all of the above has set us aside from our peers and motivated a company as large and as influential as Grupo Corporativo Fuertes S.L. to invest not only in a joint venture with us, but also in our future market value, which we are already jointly building.
“The Russian consumer market is No. 6 in the world. For years, its agricultural potential has been undervalued. Today, we strongly believe that Russia's agricultural sector is becoming a real driver of the country's economy. In our view, PJSC Cherkizovo Group, to a large extent, defines the agricultural scene. For us it is a proxy for the sector, a reliable and open partner, with whom we are set to become the leaders in turkey production in Russia.
We also believe that Russia has all the makings of becoming a leader on the export market, and Cherkizovo Group, in our view, will be in the lead. That is why a decision to become a shareholder was an obvious one for us, and the one that will incentivize us to work towards long-term value of all the businesses of PJSC Cherkizovo Group,” added Mikhailov.
PJSC Cherkizovo Group and Grupo Corporativo Fuertes S.L. entered into a strategic partnership in 2012 having launched a joint turkey production complex in the Tambov region, poised to become Russia’s largest turkey growing facility once it is completed in 2016.