Agrone completes takeover of Latvia’s leading dairy businesses

Estonian agricultural group Agrone completed its acquisition of Latvian dairy companies Rīgas piena kombināts and Valmieras piens on Friday, ERR reported. Through its parent company, Agrone acquired all shares in Food Union Management, which holds majority stakes in both businesses.

The seller was Food Union Luxembourg Holdings II S.à r.l. The deal was completed after approval from the competition authorities in Estonia and Latvia and was financed by SEB. The purchase price was not disclosed.

Agrone chief executive Raul Jeets said the acquisition would combine the group’s raw milk production experience with Rīgas piena kombināts’s expertise in processing, product development and sales. He said the deal was a strategic step that could support growth in the Baltics and expand exports.

Rīgas piena kombināts chief executive Artūrs Čirjevskis said the companies would continue providing dairy products to customers and consumers as part of a larger Baltic dairy group covering the full value chain. SEB’s corporate banking head, Joosep Kadak, said the two Latvian companies already export about a third of their output to more than 30 countries.

The ownership change will not initially affect the daily operations of either company or their relationships with employees, customers, raw milk suppliers and other partners. Production and deliveries will continue as usual. Agrone and the Latvian companies’ management teams will next develop a joint strategy for the businesses.