Investment fund Baring Central European Fund (BCEF) got closer to its exit from the Topway business last week, when it sold one of the plants from the company’s edible oil division to Romanian businessman Vasile Nitescu.
Last summer, Baring, which invested $9.5 million in Topway, sold the group’s margarine and ketchup units to Norwegian company Orkla.
According to BCEF officials, the fund’s withdrawal may also continue in 2004, when it aims to sell the remaining assets, namely another two edible oil plants.
“This transaction points to the new dynamics in Romania, reflected by the increasing number of private local investors, who have the skills, the experience and the resources to make investments in the local companies,” BCEF managing partner Gyuri Karadi said.
The value of the transaction was not disclosed. Ultex posted $40 million in turnover in 2002 and net profit of $223,000.
“We made this acquisition with the plant’s development in mind. Ultex is well rated and needs working capital. Once the plant acquired, we also have the right to use the Bunica (‘Granny’) brand,” Vasile Nitescu told Ziarul Financiar.
Vasile Nitescu is chairman of trading company Romilexim, which ranks among the top Romanian exporters. Following the transaction, Topway Industries was left with two more edible oil plants, based in Craiova and Podari.
Furthermore, the company, which used to be the third-largest player on the Romanian edible oil market, will see its 17% market share plunge following the transaction.
Leonard Gherghina, the BCEF official in Romania, did not comment upon the transaction. The Romanian edible oil market is estimated at $300 million annually, with the most important player being the US group Bunge, with 35%- 37% market share, while Argus Constanta ranks second. laurentiu.ispir@zf.ro