Riga and Washington, DC, November 2, 2015 – Darby Private Equity (“Darby”), the dedicated private equity arm of Franklin Templeton Investments, announced that Darby Converging Europe Mezzanine Fund (the “Fund” or “DCEMF”) has completed a transaction to sell its 100% stake in Rigas Piensaimnieks SIA (the “Company” or “RPS”) to an indirect subsidiary of Meridian Capital CIS Fund (“Meridian”). Financial details of the transaction were not disclosed.
Based in Riga, RPS is one of the largest dairy companies in Latvia. RPS specializes in value-added products of which the most important are processed cheese and curd snacks. RPS owns several widely recognized brands in Latvia and in the Baltic countries, including the Karums and Dzintars brands.
DCEMF first invested in the Company through a combination of debt and minority equity in July 2006 and has been the 100% owner of the Company since November 2010. After taking full control of the Company, DCEMF brought industry experts to the RPS board and focused on improving its operating and financial performance, while at the same time, maintaining its market presence, an effort which was successfully led by the Company's CEO, Mr. Neeme Jogi.
Meridian is a global private equity investment group that has already made several investments in the dairy industry in Russia and the Baltics. Most notably, it has supported Mr. Andrey Beskhmelnitskiy, co-founder of Unimilk, a leading dairy conglomerate in Russia, Ukraine and Belarus, currently co-owned by Danone, Meridian and other parties, in creating the Food Union group, comprised of Rigas Piena Kombinats (the largest dairy in Latvia), Valmieras Piens (one of the largest dairies in Latvia), Premia (a leading ice cream and frozen food producer in Estonia) and Premier Is (a leading ice cream producer in Denmark).
“RPS is an excellent company that has an attractive market position, built on the strength of its consumer brands. We believe the Company's successful development will continue under Meridian's ownership, particularly given their strategic interest and deep expertise in the dairy industry in Latvia and the Baltic region,” said Mr. Nicholas Kabcenell, managing director with Darby, based in Washington, D.C.
Darby Private Equity has played a pioneering role in bringing structured equity and mezzanine finance—a hybrid of both debt and equity—to emerging market regions. Including DCEMF, Darby Private Equity manages two Central and South East Europe dedicated funds, which have collectively made 21 investments in the region.
About Darby Private Equity
Darby Private Equity was founded in 1994 by The Honorable Nicholas F. Brady, who served as U.S. Secretary of the Treasury between 1988 and 1993. Richard Frank joined the firm as CEO in 1997 after his career at the International Finance Corporation (IFC)/World Bank. In 2003, Darby became a fully owned subsidiary of Franklin Resources, Inc. [NYSE:BEN], a global investment management organization operating as Franklin Templeton Investments. For more information please visit darbyoverseas.com.
About Franklin Templeton Investments
Franklin Templeton Investments provides global and domestic investment management to retail, institutional and sovereign wealth clients in over 150 countries. Through specialized teams, the company has expertise across all asset classes—including equity, fixed income, alternative and custom solutions. The company's more than 600 investment professionals are supported by its integrated, worldwide team of risk management professionals and global trading desk network. With offices in 35 countries, the California–based company has more than 65 years of investment experience and over $770 billion in assets under management as of September 30, 2015. For more information, please visit franklinresources.com.
About Meridian Capital CIS Fund
Meridian Capital is a global private equity investment group that has made several investments in dairy companies in Russia and the Baltics countries, among other investments. Meridian Capital financed the roll-out of Unimilk, which became the second largest Russian dairy company at the time of its merger with Danone's fresh dairy division in Russia. The Danone-Unimilk joint venture, where Meridian and its partners currently hold a substantial minority, became the leading dairy manufacturer in the CIS Region. Currently, Meridian Capital is supporting the expansion of Food Union in the Baltic States, CIS countries as well as China.
About Food Union
Food Union is the largest milk processing company and the leading food and beverage producer in Latvia, and the leading ice cream producer in the Baltic countries. The Food Union brand unites two biggest dairy companies in Latvia – AS Rīgas piena kombināts and AS Valmieras piens, the largest ice cream and frozen food producer in Estonia – Premia, and the leading ice cream producer in Denmark – Premier Is. Food Union group turnover in 2014 amounted to EUR 175 million. Food Union currently employs more than 1000 people in the Baltics. The operations of Food Union meet the highest food safety and quality standards. The company's production facilities have received the ISO 9001, ISO 14000 and ISO 22000, FSSC 22000 and China's food safety HACCP certificates.