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FirstFarms signs letter of intent to buy Romania-focused AIC

FirstFarms signs letter of intent to buy Romania-focused AIC Image by

BUCHAREST (Romania), January 27 (SeeNews) - Danish agricultural investment company FirstFarms said on Monday it has signed a letter of intent for the purchase of Romania-focused AIC.

The transaction structure has not been finally determined yet, but it has been agreed that the owners of AIC will be paid in shares of FirstFarms, according to the release, FirstFarms said in a press release.

It is intended that the owners of AIC will receive 1,198,500 new shares in FirstFarms, and a conditional receivable corresponding to the value of 50,000 shares at the time where the receivable is to be settled. The  new shares are planned to be issued by a capital increase at minimum market price pending authorization by FirstFarms' board of directors.

If the transaction is carried out according to that plan, the owners of AIC will hold a stake of 16.5% in FirstFarms.

AIC is a holding company whose main asset is the Romanian company AISM SRL, which owns 2,430 hectares of agricultural land in northern Romania, a modern silo with 6,000 tonnes storage capacity, feed mills as well as storage and office facilities, according to the press release. AIC is owned by Bendt Wedell, Anders Kirk Johansen and Ulrik Theophil Jorgensen. 

"This is primarily an investment in land and storage capacity. The land prices in Eastern Europe are increasing, and with this purchase we invest in land and stock of very good quality with a range of potential applications," FirstFarms CEO Anders H. Norgaard said.

Norgaard added that the purchase provides an opportunity to make better use of FirstFarms competences in Romania.

The transaction is expected to be completed in the second quarter of 2020 at the latest and contribute positively to the company's results in the current financial year.

FirstFarms is a public limited company which invests in agriculture and land in Eastern Europe. The company purchases and modernizes farming companies in order to optimize their operations in terms of competitiveness of the price and quality of their produce. It has been listed on NASDAQ Copenhagen since December 2006.