15 November 2012

Foreign Investment In Ukrainian Agriculture

Frishberg & Partners


Frishberg & Partners
Two weeks ago Frishberg & Partners held a round table on "Foreign Investment in Ukrainian Agriculture."
Ukraine Government, Public Sector
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Two weeks ago Frishberg & Partners held a round table on "Foreign Investment in Ukrainian Agriculture." We are pleased to share with you a transcription of that highly informative event (you may follow the link here).

Our speakers included Mr. Jens Bruno, who works with an agricultural holding company "Grain Alliance" in Ukraine and Mr. Roman Fedorowycz, is an ex-founder, CEO and land acquisition manager for Ukrainian Agrarian Investments Ltd.

Acquisitions in Ukrainian Agribusiness & Food Processing Sector

Since our earliest days, Frishberg & Partners has played an important role with respect to the commercial development of Ukrainian agribusiness and food processing.

For instance, Frishberg & Partners assisted Swedish investors with the valuation and acquisition of a majority stake in a food-processing facility near Kherson, in southern Ukraine. Our strict application of valuation techniques, as proscribed in Ukrainian privatization law, secured a favorable factory valuation on behalf of our client. Frishberg & Partners' contribution to this Swedish-Ukrainian venture constituted one of the first steps towards launching the now famous brand of sauces and juices throughout Ukraine.

We also played an integral role in creating the Slavutich brand of beer. Our legal advice to one of Slavutich's investors, Baltic Beverages Holding AB, began with a due diligence of acquisition targets. We assisted with the acquisition of pre and post-privatized soda-water and brewing facilities, prepared Privatization Plans associated with acquisition of pre-privatized entities, reviewed and negotiated share-purchase agreements in the case of post-privatized companies, prepared both cash and in-kind contributions to corporate capitalization in Ukraine, and obtained required Antimonopoly Committee approvals.

We also helped a major Dutch trader of cheese products to set up a dairy farm and yogurt-manufacturing facility near Kiev. This work involved joint venture formation with local partners; land-allocation issues; licensing and product certification, among other matters. One of the thorniest issues faced during the course of this project concerned preparation of a loan from the Dutch National Investment Bank, or "NIB", to the Ukrainian joint venture by way of the foreign investors' Dutch entity, which served as guarantor. This financing was needed to procure yogurt-manufacturing equipment (pressurized tanks, pasteurizing equipment, etc.).

Other issues addressed in this sector include: procurement of required licenses; attention to product certification issues; and, long-term lease of agricultural land.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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