Exclusive: Ukraine's Allseeds plans overseas listing - CEO
Pavel Polityuk, Reuters, YUZHNE, Ukraine
Wed, Oct 10, 2018
YUZHNE, Ukraine (Reuters) - Allseeds, which operates one of Ukraine’s largest multi seed oil extraction plants, plans to list its business overseas in the next four years, its chief executive told Reuters.
Ukraine is the world’s largest sunflower oil exporter and among the leading exporters of wheat, corn and barley.
Allseeds would become the first Ukrainian company since 2012 to hold an overseas Initial Public Offering (IPO) and the first agribusiness since 2011.
“Our plan is to hold an IPO in the next four years. We are considering Singapore, Hong Kong, Toronto. The company’s structures are ready for the IPO,” Viacheslav Petryshche said in an interview.
FMO, the Dutch development bank, and private equity firm Diligent Capital Partners, jointly own 16 percent of Allseeds.
“Allseeds has an ambitious expansion strategy of becoming an agri-processing and logistics hub which would require over $200 million of investment over the upcoming years,” Dan Pasko, DCP’s Co-Managing Partner, told Reuters.
“We are already participating in this expansion but also will be exploring all additional options to finance this strategy including a potential IPO,” said Pasko, who sits on the Allseeds board of directors.
Speaking in Yuzhne near the Black Sea port of Odessa, Petryshche said Allseeds planned to invest around $140 million in new vegetable oil facilities and hopes to make inroads into the global wheat flour market.
Allseeds processed 530,000 tonnes of oilseeds last season. In the 2018/19 season it plans to crush 750,000 tonnes of oilseeds and produce 350,000 tonnes of sunoil.
With a preliminary cost of around $100 million, the new plant will double the group’s crushing capacities and will process 1.5 million tonnes of soybeans or 750,000 tonnes of sunseed per year.
It could launch operations in 2021, Petryshche said.
Allseeds also wants to construct a new vegetable oil export hub in Yuzhne to allow producers to cut the time needed to load cargo onto ships.
Allseeds operates the export terminal at Yuzhne with a storage capacity of 42,000 tonnes and it plans to increase the volume to 132,000 tonnes by next year’s harvest. It will cost up to $20 million, he said.
Petryshche said the company also plans to construct a refining, deodorization and bottling plant which might cost around $20 million with a capacity of up to 500 tonnes per day.
“I think that within 18 months we will put it into operation. This will be the first or second plant in the country in terms of capacity,” he added.
The group is also considering the construction of a new wheat flour plant with a capacity of 500 tonnes per day.
“Today, the number one flour maker in the world is Turkey. And what is the most annoying - Turkey practically works on our raw materials,” he said.
Petryshche estimated that by using Ukrainian wheat his plant would shave costs by $50 per ton compared with Turkish producers.
“Ukraine should simply set up export duties on all raw materials that are leaving the country,” he said.
“Why do we have to produce millions or billions of tonnes of this corn? Produce something that is profitable for farmers and leaves the added value inside the country. Process and sell finished products.”
Editing by Matthias Williams and David Evans