The structure of the son of LUKOIL shareholder Vagit Alekperov invested in the Belarusian manufacturer of baby food
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The structure of Yusuf Alekperov, the son of LUKOIL shareholder Vagit Alekperov, acquired assets in the baby food market. The company became the owner of 49% of the Belarusian manufacturer of purees and juices Belfood Production. Investors have a high interest in the baby food market, including due to growing demand, and the location of facilities in Belarus does not interfere with development in the Russian market, experts point out.
The Ekto company of Yusuf Alekperov, the son of LUKOIL shareholder Vagit Alekperov, received 49% in the Belarusian baby food manufacturer Belfood Production. This follows from Ekto’s reporting for 2023. The cost of the investment is also indicated there – 2.33 billion rubles. Ekto and Belfood Production did not answer Kommersant.
Belfood Production operates a plant near Vitebsk, where it produces purees, juices, and nectars under the Little Happiness brand. The Belarusian agency BELTA wrote in 2022 that the enterprise can produce up to 15 million packages per month. The agency also reported that in 2022 the company occupied 25% of the local baby puree market, more than 50% of products were exported, mainly to Russia. In the materials of the Council of Ministers of Belarus, the owner of Belfood Production was the Cypriot BPG European Baby Food Ltd, whose owners are unknown.
According to a Kommersant source familiar with the asset, Belfood Production was founded by local entrepreneurs who began looking for buyers for the business in 2023. According to Kommersant’s interlocutor, Swan Lake Capital from Minsk could act as a consultant for the transaction. Investors were offered 100% of the asset in 2023, he adds. CEO of Swan Lake Capital Anton Yakhimovich did not respond promptly to Kommersant.
Ekto’s main assets cooperate with LUKOIL. Yusuf Alekperov’s holding includes the railway operator Western Petroleum Transportation, the oil service company WellTech, where LUKOIL owns 49%, and the car dealer Lukavto 50%. In the fast-moving consumer goods (FMCG) market, Ekto owns the Plan B brand of energy drinks, which, according to the website, is sold at LUKOIL and Tatneft gas stations, as well as in the Alkoteka chain.
Kommersant’s source believes that Ekto’s investment in Belfood Production was an investment in capital, and the parties could agree on exit conditions related to the achievement of certain indicators. Investment banker Ilya Shumov notes that joint ownership reduces the risks of the new owner, preserving the potential of the business.
According to Kommersant’s source, Belfood Production should have good capacity and probably have the potential to increase sales. But, he adds, the political situation in Belarus may impose its own risks and limitations. As Ilya Shumov notes, being located in Belarus carries risks, but given the active integration of Russia and Belarus in recent years, hardly anyone assesses these risks as significant. According to him, Russian investors, when buying assets in Belarus, are more likely to see the advantages, since the multipliers for such transactions are usually lower than in Russia, and the sales market is the same. Recently, he adds, the number of proposals for the sale of assets from Belarus has been growing.
As Mr. Shumov notes, product manufacturers are generally in demand among investors, and interest in assets in the production of baby food is even higher due to limited supply and growth of the segment. According to NielsenIQ, in 2023, sales of baby food in Russia increased by 6.8% in packages and by 8.4% in money. Sales of children’s muesli bars and marmalade grew at the fastest rates in physical terms – by 38% and 35%, drinks – by 19.5%, and viscous baby food – by 18.1%, according to NielsenIQ calculations.
Rusbrand executive director Alexey Popovichev says that competition among baby puree manufacturers is high, but players have opportunities for development through investments in marketing and smart pricing policies. In addition, he adds, many consumers in Russia perceive Belarus as a place for the production of high-quality and natural products.
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