The Czech agri-food group Agrofert, controlled by former prime minister Andrej Babis, received the European Commission's approval to take over the Romanian grain and oilseeds trader East Grain.  

The transaction relates primarily to a 65% stake in the Romanian company, taken over through a capital increase, Ziarul Financiar reported.

East Grain, part of East Group, is one of the biggest players in Romania's grain and oilseed trade and is controlled by several entrepreneurs from Romania and Hungary. It posted a turnover of over RON 714 million (almost EUR 150 million) and a net profit of RON 16.9 million in 2022.

The company competes with large foreign grain traders, such as the Chinese from COFCO, the Americans from ADM, CHS, and Cargill, and the Swiss from Ameropa, on a market where Romania's annual grain and oilseed exports exceed EUR 4 billion.

East Grains is active in Romania, Hungary, and Serbia. The company's business increased at a combined average rate (CAGR) of 22.5% over the last 5 years.

East Grain's main activity is the trading of cereals and oilseeds, but the company also provides a number of related services, such as logistics, storage, processing, and integration services.

The transaction is carried out mainly through a capital increase and represents the most important external investment in Romanian agribusiness in the last year, according to an East Grain press release issued last October when the deal was announced. 

The company said the investment will enable East Grain to support its vision of expansion and diversification.

Founded in 1993 by Babis, Agrofert is one of the main players in the agri-food industry in Central Europe, with approximately 31,000 employees and over 220 subsidiaries.

Agrofert is the largest group of companies active in agriculture and the food industry in the Czech Republic, with revenues of EUR 10 billion and approximately 30,500 employees in 2022.

iulian@romania-insider.com

(Photo source: Stefan Dinse/Dreamstime.com)