April 23 (SeeNews) - Romanian farming company Holde Agri Invest said on Thursday that it has signed an agreement for the acquisition of Agromixt Buciumeni - a local company operating farmland in Calarasi county.
Agromixt brings a new nucleus to Holde Agri Invest, namely the farm in the Calarasi county, which distinguishes itself with a compact size and high-quality soil, Holde Agri Invest said in a press release.
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Additionally, rapeseed and soybean, which is cultivated on the Agromixt farm each year will complement the current list of crops grown on Holde’s farms.
The transaction, whose value was not disclosed, was split into two steps. Currently, Holde Agri Invest has a 30% stake in the company, and in the following months, the remaining 70% of shares will be transferred to Holde.
"We are pleased about the acquisition of Agromixt Buciumeni because we consider this investment as of strategic importance for Holde. Following this transaction, Holde boasts over 7,000 hectares of operated land, a milestone that we have promised to our investors who participated in our private placement in December 2019," Holde Agri Invest CEO Liviu Zagan said in the press release.
The acquisition was financed partially with capital raised during the private placement of Holde shares that took place in December 2019, and partly with debt financing.
While the integration of Agromixt will be the immediate priority for Holde in the next period, Holde are already considering new financing rounds in the Romanian capital market, Zagan said.
"We consider financing with the help of stock exchange mechanisms as an extremely effective way that will help turn Holde from an agricultural start-up to a player of reference on the local agri-sector," the CEO said.
Following the deal, Holde Agri Invest reaches 55 employees across the company’s primary locations as well as in the shared services centre in Bucharest.
Holde Agri Invest was determined to close the transaction irrespective of the current context of COVID-19 outbreak in Romania as the demand for agricultural production remains unchanged, and farming companies need to ensure business continuity, the company said.
Agromixt Buciumeni is a Romanian company established in 1991 that operates farmland in the Calarasi county. In 2019, Agromixt had 21 employees, a net profit of 5 million lei ($1.12 million/ 1.03 million euro) and revenues of over 20 million lei.
The concept for Holde was invented in 2016 by four Romanian entrepreneurs: Liviu Zagan, Robert Maxim, Matei Georgescu, and Alexandru Covrig. In 2017, the founders joined forces with the team from a local asset management company, Certinvest and together they established Holde Agri Invest in 2018.
After closing private placement for its shares in December 2019, Holde Agri Invest has 52 shareholders. Vertical Seven Group remains the biggest single shareholder with a 19.6% stake, while the remaining investors have holdings between 9% and 0.1% in the business. The business model envisages that no single shareholder holds a majority stake.
The company announced last year in November that it plans to list in 2020 on the AeRO market of the Bucharest Stock Exchange.
(1 euro = 4.8382 lei)