Milkiland acquires cheese factory in Poland

Milkiland, a dairy group with assets in Ukraine and Russia, has acquired Mazowiecka Spoldzielnia Mleczarska 'Ostrowia', a cheese factory in Ostrow Mazowiecka of Masovian Voivodeship, Poland.

"Ostrowia is an advanced cheese making facility capable of producing wide range of dairy products essential to Milkiland, including hard cheese, curd cheese, yoghurts and processed cheese," Milkiland said in a press release.

As Milkiland said in a statement on the Warsaw Stock Exchange, Milkiland EU sp. z o. o., a newly established Polish subsidiary of Milkiland N.V., on July 31, 2012, acquired 100% shares in Polish-based Emir 10 sp. z o. o., a company that owns the business of former Mazowiecka Spoldzielnia Mleczarska 'Ostrowia', which is currently in bankruptcy liquidation. The acquisition price comprised PLN 49.3 million (EUR 12 million).

According to the press release, in 2003-2007, the Ostrowia underwent major modernization and currently comprises a state-of-the-art cheese plant. Currently Ostrowia is in stand-by mode with low capacity utilization. "It needs investments to operate at full capacity and be adjusted to comply with CIS markets requirements," reads the press release.

Milkiland plans to accomplish necessary investments by the end of 2012 and achieve the target capacity utilization in 2013-2014.

After reaching its target volume output in 2013-2014, Ostrowia will contribute around 15% to Milkiland's consolidated revenue and EBITDA, reads the statement on the stock exchange.

According to Anatoliy Yurkevych, CEO, Milkiland N.V., Ostrowia is a perfect addition to Milkiland's asset base and after launching investments will become one of the largest and best equipped cheese making facilities of Milkiland.

"Poland is already one of the largest dairy exporters in EU, and Milkiland will turn its still untapped potential to CIS markets, primarily Russia and Ukraine. Also, with Ostrowia, Milkiland opens a door to a tremendous EU dairy market, with long term opportunities for growth and business diversification," Yurkevych said.

Milkiland Group is a top five CIS diversified dairy producer operating in Russia, Ukraine and Poland.

In Ukraine, the group operates 10 plants and offers a wide range of fresh dairy, cheese and butter under Dobryana and Kolyada brands.

In Russia, the group produces fresh dairy products at Moscow-based OJSC Ostankino Dairy Combine and sells under the Ostankinskaya brand. Also, Dobryana Ukrainian cheese is sold in the most Russian regions.

Milkiland N.V. is a Dutch holding company of the Milkiland Group. DE Milkiland Ukraine and Milkiland sp. z. o. o. are the 100% subsidiary company of Milkiland N.V., which control the group's business in Ukraine and Poland subsequently.

Shares of Milkiland N.V. are listed on the Warsaw Stock Exchange since December, 6, 2010.