SOFIA (Bulgaria), September 24 (SeeNews) - Sofia-based producer and distributor of organic products Smart Organic said on Friday that it will seek to raise 3 million euro ($3.5 million) through an initial public offering (IPO) on the Bulgarian Stock Exchange (BSE).
The company intends to use the proceeds from its IPO for the acquisition of an unnamed German competitor and the construction of a new production plant, it said in a statement published on its LinkedIn profile.
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Smart Organic plans to kick off its IPO at the end of October on the BSE's SME growth market BEAM, local business news outlet Capital.bg reported late on Thursday.
The deal with the German company is at an advanced stage and according to plan, it should be closed in November, Capital.bg said.
"In 2020 the company saw an increase in sales of about 11% and it expects 26% organic growth in 2021. Together with the consolidated revenue of the German company, which we are about to buy, we expect some 30 million euro in sales in 2021," the media outlet quoted Yani Dragov, founder and owner of Smart Organic, as saying.
In 2019, Smart Organic's sales revenue rose to 33.3 million levs ($20 million/17 million euro) from 30.2 million levs a year earlier, according to company data published in the commercial register.
The company will invest part of the IPO proceeds in the construction of a production facility that will spread on 4,000 sq m. "We are currently choosing a suitable site, and the plans are for construction works to start in the spring of 2022. About 6 million levs are planned for the first stage of construction," Dragov said, adding that the investment in the production plant will allow Smart Organic to double its output volume.
This will be a second IPO attempt for Smart Organic. In 2015, the Bulgarian financial regulator said it rejected the company's prospectus for a planned IPO. Smart Organic had planned to raise 3.0 million levs from the capital market, Capital.bg said at the time.
Smart Organic was founded in Sofia in 2009 and is currently among the leading producers and distributors of organic food in Europe. Through its network of distributors and retailers, the company's products are available in more than 60 countries worldwide - in the EU, as well as in Asia and the Americas, according to information published on Smart Organic's website.
The company is producing the majority of its products in its own factory in Sofia which spreads on over 6,000 sq.m.
Elsewhere in Southeast Europe, the company is active on the Romanian market.
($ = 0.8520 euro)