DGAP-News

Ekosem-Agrar strengthens the financial foundations for its growth strategy

Ekosem-Agrar GmbH / Key word(s): Bond

31.10.2013 18:12

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Ekosem-Agrar strengthens the financial foundations for its growth strategy

- 2012/2018 bond increased by EUR 18 million to EUR 78 million

- Promising environment: undersupplied milk market, farmland prices
picking up

- Targets through 2015: 28,000 dairy cows, more than 250,000 hectares of
farmland

Walldorf, 31 October 2013 - Autumn 2013 has seen Ekosem-Agrar, the German
holding company of Russian milk producer Ekoniva Group, further
strengthening its solid financial foundations for the continued
implementation of its growth strategy. In a private placement, Ekosem-Agrar
increased its corporate bond (ISIN: DE000A1R0RZ5), which carries a coupon
of 8.5 % and will mature on 6 December 2018, by EUR 18 million to EUR 78
million. The bonds are expected to be listed for trading in the Bondm
segment of the Stuttgart stock exchange starting 4 November 2013. With
equinet Bank AG serving as lead manager and book runner, the issue was
subscribed by institutional investors in Germany and Switzerland. It comes
on the back of a 5% capital increase which raised the company's equity by
EUR 10 million in September 2013.

Since the issue of its first corporate bond in March 2012, Ekosem-Agrar has
increased its dairy herd from 12,200 to 17,000 cows and expanded its
farmland from 71,300 hectares to 103,400 hectares. Earnings before interest
and taxes (EBIT) for the first half of 2013 rose by 55% year-on-year from
EUR 8.9 million to EUR 13.8 million. The dividend holiday committed to in
the terms and conditions of the bond issue means that the Group's
profitable growth continues to strengthen its equity position.

'We have a clear growth strategy in place, during which period we want to
push ahead our profitable business model and continue to expand our
market-leading position', says Stefan Dürr, Managing Director and majority
shareholder of the Ekoniva Group. 'Farmland prices in Russia are very low
by international comparison, particularly in view of the high quality of
the soil and the potential yields. We currently see a clear upward trend
which should continue over the medium term.'

The company's dairy herd is to be increased to 28,000 cows by 2015. As the