OJSC Cherkizovo Grp (CHE) - Cherkizovo Group signs a Cooperation Agreement RNS Number : 6740D OJSC Cherkizovo Group 18 May 2012 Cherkizovo group, spanish grupo fuertes and tambov region administration sign a cooperation agreement Tambov, Russia, 18 May 2012 - On May, 17 in Tambov, an agreement to build an integrated turkey production complex was signed. This project will be carried out by Cherkizovo Group with Grupo Fuertes, a large agro-industrial company and the leading producer of turkey in Spain. More than EUR 100 million will be invested in the development of the project. As part of the agreement, a turkey meat production joint venture between Cherkizovo and Grupo Fuertes has been set up called Tambov Turkey LLC. Hannes Snellman acted as a legal advisor to Cherkizovo Group. Oleg Betin, Head of Administration of the Tambov region, Igor Babaev, Chairman of Cherkizovo Group, Sergey Mikhailov, CEO of Cherkizovo Group, Tomás Fuertes Fernández, President of Grupo Fuertes, and Jose Fuertes Fernández, CEO of Grupo Fuertes, took part in the signing ceremony. The participants also visited the land plot in the Pervomaiskiy district, where the complex will be built. The new turkey production complex will be developed on a 5000 ha site in the Tambov region of Russia. The annual capacity is expected to be 25-30,000 tonnes of turkey meat in sellable weight, which may increase to 50,000 tonnes in sellable weight in the medium term. Once achieved, this would make Cherkizovo the market leader in the fast growing and highly profitable Russian turkey meat market. The total planned investment is RUR 4.5 billion (including VAT), which is equivalent to over EUR 100 million at current exchange rates. The project will be financed equally by Cherkizovo and Grupo Fuertes from existing funds and through bank loans. The Tambov regional administration has agreed to provide the necessary infrastructure for the construction of the complex. Head of Administration of the Tambov region, Oleg Betin said: "The entrance of such big Russian and international investors as Cherkizovo and Grupo Fuertes in the Tambov region once again proves the attractiveness and high agrarian potential of our region. Under the region's legislation, the investment activities will benefit from governmental support and we plan to take a versatile approach when providing support for this project." CEO of Cherkizovo Group, Sergey Mikhailov said: "Today we are launching a unique project. Firstly, the substantial experience of our partners will enable us to build a production site of European standard quality and efficiency; secondly, Cherkizovo has an effective distribution network which will enable rapid and efficient delivery of new products to Russian markets. Support, provided by the regional administration will be fundamental to the successful realization of this project. I would like to personally thank the Administration of the Tambov region and governor Oleg Betin for their support." President of Grupo Fuertes, Tomás Fuertes said: "We are starting this important project by investing in the promising and rapidly developing Russian market. The project will be carried out in collaboration with Cherkizovo Group - a partner we trust and with whom we are ready to share our experience and modern technology in turkey production. We believe that Cherkizovo, with support of the Tambov regional Administration, will be able to build an effective production cluster and in three years, Russian consumers will be able to enjoy high quality turkey meat." About Cherkizovo Group Cherkizovo Group (LSE:CHE) is the largest meat manufacturer in Russia, with 2011 revenues of circa USD 1.5 billion. It is also one of the top three companies serving Russia's poultry, pork and meat processing markets. Due to its vertically integrated structure that includes grain storage facilities, feed production, livestock breeding, growing and slaughtering as well as meat processing and integrated distribution, Cherkizovo has consistently delivered sustainable revenue and profit growth. Cherkizovo's strategy includes both organic growth and investment in new projects, driving the consolidation of the Russian meat market. Cherkizovo shares are quoted on the LSE and RTS/MICEX. About Grupo Fuertes Grupo Fuertes is a large Spanish holding company, which consists of over 20 companies, many of which are focused on the agro-industrial sector. These include well-known companies such as: Agrifusa (agriculture), Cefusa (cattle breeding), El Pozo Alimentación (production and processing of meat), Procavi (production and processing of turkey), Sediasa (grinding and preparation of food) and Fripozo (deep-freeze products) among others.Grupo Fuertes also owns oil and gas company Aemedsa, hotel managing company Visoteles, and managing company Profusa which is involved in development in south-eastern Spain. Grupo Fuertes revenue is about EUR 1.1 billion. The holding employs 5450 people. Procavi is part of Grupo Fuertes and is the leading producer of turkey in Spain with a share of over 43%. Procavi has a fully integrated production system with excellent control systems at all production levels. Annual production capacity of the company is over 55000 tonnes, which is approximately 7 million turkey heads. Sales of the company are over EUR 129 million, with plans to double this in the medium term. For further information: Investors / Analysts / Russian media Alexander Kostikov Tel. +7 495 788 3232 ext. 5019 Head of Communications email@example.com UK/international media Tom Allison Temple Bar Advisory Tel: +44 20 7002 1080 (London) Alex Money firstname.lastname@example.org *** Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of the Group. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might" the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid market change in our industry, as well as many other risks specifically related to the Group and its operations This information is provided by RNS The company news service from the London Stock Exchange END MSCLVLFFLEFBBBK -0- May/18/2012 12:10 GMT
OJSC Cherkizovo Grp CHE Cherkizovo Group signs a Cooperation Agreement
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