The turkey will be shown at the auction

Despite the growing Russian market for turkey production even during the crisis, the owners of some enterprises are trying to get rid of their assets. Thus, Vostochnaya-Agro, a large company in the Orenburg region, is put up for sale, controlled by the structures of the ex-deputy of the regional legislature Vladimir Kidanov. In February-April, some producers experienced serious problems with the supply of hatching eggs. This, experts do not exclude, was one of the reasons for the sale of the asset.

The fact that the turkey producer Vostochnaya-Agro with an annual capacity of 5.3 thousand tons of turkey in live weight is put up for sale, Kommersant learned from the presentation of the Investment Promotion Agency of the Orenburg Region. The starting price of the asset is indicated there – 750 million rubles. Vostochnaya-Agro’s presentation states that in the future the company can increase production by 10 thousand tons per year in live weight.

The enterprise is part of the agricultural holding “Rus”, where the chairman of the board of directors is the ex-deputy of the legislature of the Orenburg region Vladimir Kidanov. The agency and Rus did not respond to Kommersant’s request.

Agrifood Strategies President Albert Davleev believes that the reason for the sale of the complex may most likely be the owner’s fatigue from the turkey business and his desire to switch to other industries. A Kommersant source on the market names another reason: in February-April, against the backdrop of the Russian military operation in Ukraine, Vostochnaya-Agro encountered difficulties in acquiring hatching eggs. “The current owner wants these to be the problems of new investors in the future,” explains the interlocutor of Kommersant.

Turkey farming in Russia continues to grow, says Albert Davleev. At the end of 2021, turkey production in the country increased by 22.18%, to 400.4 thousand tons. In the first half of 2022, according to preliminary estimates of Mr. Davleev, the growth was 15% year-on-year, which makes this sector “interesting for investors”. The expert gives an example of the expansion of the capacities of the Damate Group of Companies, as well as last year’s purchase by the Cherkizovo group of the Krasnobor company.

Vostochnaya-Agro is under serious pressure from its closest competitor, the Bashkir poultry complex named after Gafuri, located 200 km from the Orenburg site, continues Albert Davleev. Last week, this enterprise was bought out at auction for 3.3 billion rubles. Kazakh GB Finance Ltd (see Kommersant dated August 19). Ideally, it would be more logical for the new owner of the Gafuri complex to combine Vostochnaya-Agro with his own enterprise, which would give synergy in production, the expert believes. GB Finance Ltd could not be reached for comment.

Andrey Grigorashchenko, vice-president of Damate Group of Companies, is aware of the sale of Vostochnaya-Agro, but says that the companies have not officially offered to purchase this asset. At the same time, Damat is not considering the purchase of the site, since, according to Mr. Grigorashchenko, the capacities of the enterprise put up for sale are small and difficult to integrate into the company’s technological chain. Cherkizovo stated that they continue to increase the volume of turkey production, but the question of interest in Vostochnaya-Agro was left unanswered.

Anatoly Velmatov, executive director of the National Association of Turkey Producers, notes that in the current situation, it is more efficient for companies that decide to increase their production volumes to buy ready-made production than to build new sites. This is due, among other things, to the risks of stopping the supply of equipment due to possible sanctions and high volatility in the building materials market.

Alexey Polukhin