Cherkizovo Group acquires facilities of Zdorovaya Ferma agricultural holding company

Chelyabinsk, Russia — December 21 — Cherkizovo Group (MOEX: GCHE), Russia’s largest meat producer, won an auction to purchase the assets of the Zdorovaya Ferma group of companies, the largest poultry producer in the Urals. The deal will enable the Company to achieve broiler meat production in excess of 1 million tonnes of live-weight meat per year.

On Tuesday, December 20, the Auction House of the Russian Federation held an open auction to sell the assets of the Zdorovaya Ferma group of companies. The seller was non-core asset bank Trust. The single lot included 100% interest in Ural Meat Company LLC, Zdorovaya Ferma Group of Companies LLC, Zdorovaya Ferma Deli Meats LLC, Zdorovaya Ferma Trading House LLC, JSC Uralbroiler, and rights to claim against the above legal entities held by Trust and JSC Komsomolskaya Poultry Farm.

The winning bidder was AIC Mikhailovsky (part of Cherkizovo Group). Previously, the company secured a preliminary approval of Russia’s Federal Antimonopoly Service to acquire the above facilities. The total deal value will be RUB 5 bn, including debt of RUB 1 bn.

Legal support for the deal was provided by Birch Legal, with financial and tax due diligence carried out by Business Solutions and Technologies.

Zdorovaya Ferma is a vertically integrated agricultural holding company based in the Chelyabinsk Region. The group is the leading poultry producer in the Urals, with an established chain of supply to offer its products through national and regional retailers.

The assets of Zdorovaya Ferma acquired by Cherkizovo Group have an annual production capacity of 120,000 tonnes of live-weight poultry and cover a wide range of higher value-added products, such as ready-to-cook meat products, sausages, deli meats, and hot dogs. The assets of Zdorovaya Ferma include a feed mill with an annual capacity of 240,000 tonnes of feed.

For Cherkizovo, the Chelyabinsk Region will be the third new region of operation unlocked in 2022: previously, the Company acquired Vishnevsky Genetics and Breeding Center in the Orenburg Region and Russian Grain Ufa, the largest poultry producer in Bashkortostan. With the assets of Zdorovaya Ferma, Cherkizovo will be able to produce more than 1 million tonnes of live-weight broiler meat per year.