Agrimoney.com | 1 November 2010
Funds "significantly" oversubscribed for shares in Agroton at the Ukraine agribusiness giant's $200m flotation, after it kept the offer price well below the maximum that it had outlined.
Agroton, Ukraine's fourth-ranked wheat grower and largest sunflower seed producer, said that it had allocated extra stock to institutional shareholders, at the expense of the proportion set aside for individual investors.
The shift, after funds asked for "significantly" more shares than they were offered, followed the announcement of a flotation price for the shares of 27 zloty, compared with a top-of-the range 30 zloty.
Institutional investors will now own about 23.6% of Agroton when it formally lists in the first half of this month on the Warsaw stock exchange, where shares in Ukrainian agribusiness peers Astarta and Kernel also trade.
'Steady growth'
Iurii Zhuravlov, the Agroton chief executive, said that the company was "very happy" the appetite from investors for shares in the flotation, which raised 153m zloty ($54m), valuing the company overall at a little over $200m.
The cash raised is to be used to invest in extra storage capacity, and in acreage of land that Agroton has under cultivation.
The group currently has 151,000 hectares under management, a figure which it claims makes it the sixth-largest listed farm operator in Europe, by land size, and bigger than domestic rivals such as Landkom, MCB Agricole and Sintal.
The investment "will translate into steady growth in the value of this company in upcoming years", Mr Zhuravlov said.
Many sectors
Besides growing crops, of which sunflowers and wheat account for 80% of production, Agroton also operates a flour mill and an oil press, and a feed production business to provide forage for cattle, pig and poultry operations.
The group achieved earnings of $28.1m for the first six months of the year, up from $13.3m a year before.
Revenues at the company, which Mr Zhuravlov founded in 1992, rose by one-third to $64.0m.
