After looking at the domestic market for an acquisition, Germany's Meggle group sealed a partnership with Lactag producer in Arges county, which enables it to use Lactag's production lines to make some of the products present on Romanian store shelves.
In the wake of this partnership, Lactag could go from turnover worth almost 4m euros in 2006, to 50-60m RON (15-18m euros) by 2009.
The representatives of Meggle, a European leader of the butter market, decided to enter this partnership after having assessed several dairy plants on the domestic market, without finalising any acquisition. Meggle's domestic portfolio is divided between products manufactured by Lactag and products imported from the plants in Slovakia and Germany.
"We've signed a partnership with Meggle for the production of cream and yoghurts, a partnership due to be extended during the 2008-2009 period both in terms of product range and types of available packaging, as well in terms of production through investments in plant expansion," stated Niculae Oita Marinescu, Lactag general manager.
The representatives of Meggle Romania confirmed the partnership with the producer of Arges county and specified this would be extended during the following period through investments due to be decided by the representatives of the two companies by yearend.
Lactag representative specified that, while last year (the first year of collaboration between the 2 companies) Meggle branded products weighed around 10-15% in the company's sales, this year they will reach 30% of the total, with Meggle brand expected to account for above 50% in Lactag's turnover in 2008.
The partnership signed between the two companies, Meggle and Lactag, is the second one on the domestic market, after Campina Dutch group sealed a similar "alliance" with Covalact producer of Sfantu Gheorghe.
According to some previous information, the two companies also discussed on a possible sale of a stake in Covalact, but the discussions did not lead to a transaction. Instead, Covalact has recently signed an agreement on the sale of a 70% stake to SigmaBleyzer Southeast European Fund IV investment fund in a deal put at 7m euros.
Lactag is one of the most active players in the dairy products industry, with the company having concluded a deal related to the sale of one of the lines it owns in Campulung to Nordex Foods Danish company.
Lactag is listed on RASDAQ, having a markets capitalisation of 5.7m RON (1.7m euros). In the first half of this year, the company reported turnover worth 7.7m RON (2.3m euros), up almost 200,000 euros from the same period of 2006. Its majority shareholder is the Atlantic Invest Group based in Pitesti, with about 75%, while Gabriel Manu owns 7% in it.
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