PAG, Meridian invest $225m in Food Union Group

PAG has committed $170 million to the company, with existing investor Meridian putting in a further $55 million.

Food Union operates a group of milk processing and ice cream producing companies – including Premia, Premier Is and Ingman Ice Cream – in nine countries, most of them in Northern and Central Eastern Europe. Supplied by hundreds of farms, it processes more than 1,000 metric tons of milk every day.

The company currently exports dairy products to more than 25 countries, with the main markets being Latvia, Estonia, Lithuania, Poland, the Netherlands, UK, Azerbaijan, Russia and China. Total turnover amounted to EUR 256 million ($273 million) in 2015, 60% of which was generated by the Baltic subsidiaries.

Food Union entered the China market in 2015. It has two local dairy facilities under construction, which are expected to produce premium dairy products to Chinese consumers by the beginning of 2018.

“There is a great demand among increasingly affluent and discerning Chinese consumers for high quality protein foods such as those Food Union produces. With its technology, knowhow and capabilities, Food Union is uniquely positioned to deliver what the Chinese market needs,” Weijian Shan, chairman and CEO of PAG, said in a statement.

The Asian alternative investor manages a diverse array of alternative assets across private equity, real estate and hedge funds. PAG's debut private equity fund closed in 2012 at $2.5 billion. It is currently investing its second vehicle, which closed at $3.66 billion at the end of 2015.

Meridian Capital previously funded the acquisition of Unimilk alongside with the Food Union’s founding shareholder, turning the company into a leading dairy manufacturer in Russia. It was eventually sold to a global dairy company. Meridian subsequently invested in Food Union in 2013 and has helped the company to acquire two ice cream producers in Norway and Romania.

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• Topics
• Greater China
• Consumer
• Expansion
• Europe
• China
• Europe
• PAG