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Linas Agro Acquires 100% Stake in SIA Elagro Trade

AgriTech Chemicals and Fertilizers

Linas Agro Acquires Full Stake in SIA Elagro Trade for Growth

Business Honor
17 December, 2024

Acquisition solidifies grain export leadership in Latvia, with growth within five years expected.

The indirect controlling stake of SIA Linas Agro, controlled by AB Akola Group, has been successful in acquiring 100% of the shares of Latvian company SIA Elagro Trade involved in grain, seeds, plant protection products, and fertilizers. The deal approved by the Competition Council of Latvia increased the final amount in the transaction from €22 million to €25.5 million, with net working capital on the closing date higher than initially anticipated. It will be five years before the investment will break even.

Founded in 2010, SIA Elagro Trade has a 15% market share in Latvia with revenues of €154 million and an EBITDA of €2.1 million in 2023. The company employs 68 people. This acquisition will strengthen SIA Linas Agro operations in Latvia, where the group has been present since 2003 but was weaker in terms of grain intake, warehouse space, and market share. Mažvydas Šileika, chief financial officer at AB Akola Group, said that the company is now positive that the leadership in Lithuanian market will find its counterpart in Latvia as well. Grain exports to Latvia will boast storage capacity with an increase of more than three times to 161,000 tons.

The acquisition will complement the infrastructure of Linas Agro with new grain elevators and fertilizer storage facilities in Eleja, Jekabpils, and Skulte. AB Linas Agro CEO Jonas Bakšys said that merged resources would provide better solutions for customers, investment opportunities, and long-term stability. Consolidation is likely to bring economic benefits from five years onward.

AB Linas Agro acquired financing worth €14 million from SEB Bank to purchase the firm. The group revenues in grain and oilseeds were recorded at €388 million last year, and also revenues in seeds and fertilizers amounted to €246 million.