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DILIGENT CAPITAL PARTNERS AND FMO COMMIT $20 MILLION TO LEADING UKRAINIAN FEED PRODUCER EDINSTVO GROUP

Private equity manager Diligent Capital Partners (DCP) and Dutch entrepreneurial development bank FMO agreed to acquire a minority stake in Edinstvo Group, the leading independent producer of compound feed, packaged feed, premixes, concentrates, feed additives and distributor of veterinary drugs, animal vaccines, and pet goods in Ukraine. Edintsvo Group operates four feed mills (Dikansky, Lokhvitsky, Letichevsky and ArgoKom), as well as Inbel (Novacore), the largest premix plant in Ukraine.  The $20 million investment will be used to construct a soybean processing plant, expand feed additives production capacity and install additional feed packaging lines. These projects are expected to reduce the company’s production costs, increase the production of packaged feed, and create new jobs.

“I am proud of the hard work that the DCP and the Edinstvo Group teams undertook in reaching this important agreement and realizing this significant investment despite the uncertainty and economic turbulence of the last year.  We are especially grateful to FMO for their support of DCP’s investment strategy aimed at furthering the transformation of Ukraine’s agricultural sector from efficient production and export of raw agricultural commodities to further processing into higher value-added goods.  The Edinstvo Group is an excellent example of the successful implementation of value add processing that in turn supports additional value added activities in Ukraine, namely the production of animal proteins for both domestic consumption and export.  The Edinstvo Group has ambitious plans for further development and we are pleased to act as a financial catalyst for these initiatives” noted Dan Pasko, Co-Managing Partner of Diligent Capital.

“FMO looks forward to the cooperation with Edinstvo Group. As a development bank we aim to empower local entrepreneurs and we hope to contribute to the Group’s next phase. Together with our partner DCP, we aim to strengthen the company further and develop new segments with substantial value add and export potential, while at the same time creating new jobs,” says Jaap Reinking, Director of FMO’s Private Equity department.

“Cooperation with DCP and FMO marks a new stage in the development of Edinstvo Group. We are glad to have such reliable and experienced partners to support the implementation of our business plans. The investments will help us strengthen our market position, improve product quality and expand the range of goods with high added value” commented Sergey Semenyachenko, Co-Founding shareholder and member of the Board of Directors of Inter Edinstvo Holding.

Vitaly Strukov, Managing Partner of BDO Corporate Finance and the exclusive financial advisor to Edinstvo Group, noted “Our cooperation with Edinstvo Group dates back more than ten years and began with the development of a long-term vision and strategy and the attraction of a significant loan from the EBRD to finance the first step of that strategy.  Edinstvo Group belongs to the “top league” of feed and premixes producers in Ukraine and I am pleased that we were able to attract an equally strong and experienced partner as DCP to continue the realization of Edinstvo Group’s  long-term strategy. ”

The transaction was also supported by a number of leading professional advisory firms including Avellum, OMP, Eterna Law, Snark for legal, Deloitte for financial and tax, AVGroup for environmental and social, and Civitta for commercial due diligence.

NOTES: Edinstvo Group is a leading producer of feed in Ukraine and formerly a part of the Inter Edinstvo Holding.  The company produces compound feed, packaged feed, premixes and concentrates, feed additives, and distributes veterinary drugs, animal vaccines, and pet goods.  The products are sold under the trademarks Schedra Nyva, Balans Optima, Feedline, BestMix, Provitan, TOP Korm, MAX Effect, FeedMix, Intelligent Nutrition and AnimAll.

Diligent Capital Partners is a private equity fund manager with a focus on export-orientated business, agribusiness, and technology.

FMO is the Dutch entrepreneurial development bank. As a leading impact investor, FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs. FMO believes that a strong private sector leads to economic and social development and has a 50-year proven track-record of empowering people to employ their skills and improve their quality of life. FMO focuses on three sectors that have high development impact: financial institutions, energy, and agribusiness, food & water. With a committed portfolio of EUR 9.7 billion spanning over 85 countries, FMO is one of the larger bilateral private sector development banks globally.

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