On January 22, 2018, AUGA group has signed the share sale and purchase agreement to acquire 100 % share capital of UAB Arginta Engineering for EUR 6.4 million.
UAB Arginta Engineering specializes in the design and production of customized metal constructions: prototype equipment, transformer components, conveyer and lifting equipment, machinery for paper processing, energy production, agriculture and other industries. The company’s main customers are multinational engineering companies abroad; 98% of its production is exported.
The revenue of UAB Arginta Engineering was EUR 12.5 million and EBITDA was EUR 0.7 million, according to the 2017 unaudited financial statement. Net financial debt was EUR 0.7 million on December 31, 2017. The company employs 170 people.
“Due to the expansion of AUGA group, AB activities and the growth of organic food markets, we anticipate further demand for technologies and effective solutions for sustainable food production. We consider Arginta Engineering to be one of the most advanced engineering companies in Lithuania. By acquiring its shares and combining the activities of both companies, we see a great opportunity to strengthen AUGA group’s competencies in this technology sector”, – states Kestutis Juscius, Chairman of the Board of AUGA group, in regard to the motives of the acquisition.
According to K. Juscius, the acquired production base, know-how, experience and team of professionals will allow AUGA group, AB to develop innovative equipment, machinery and unique technological solutions for a clean and sustainable food supply chain.
Gintautas Kvietkauskas, co-owner and director of UAB Arginta Group, parent company of UAB Arginta Engineering, admitted that in making the decision to sell the company, one of the main conditions for the acquiring party, was to ensure the continuity of company’s main business. “After becoming a part of AUGA group, Arginta Engineering will not change its strategic business direction and will continue to work with big international customers, providing them with complex, non-standard engineering design and production services. In addition, its scope of operations will expand with the projects being developed by AUGA group. By selling shares of Arginta Engineering to AUGA group, we are certain of the synergy of operations and sustainability of value, created by both companies”, – states G. Kvietkauskas.
The acquisition should close upon receiving the necessary approval from the Competition Council of the Republic of Lithuania.
Today, AUGA group has also announced that it will seeks to raise additional capital through a follow-on public offering of the company‘s shares by the end of the first half of 2018. It is targeted to raise up to EUR 20 million of additional equity funding, which would be used to finance ongoing acquisitions and to invest in further business development.
„During the last few years, AUGA group has consistently executed its strategic plans, signed several successful acquisition deals and demonstrated improving business results. Both the acquisition of UAB KTG Agrar and UAB Raseiniu Agra will provide the opportunities to meet the increasing demand of organic markets and to expand the production of organic products for end consumers. The acquisition of UAB Arginta Engineering, announced today, is another strategic direction for business development of AUGA group“ – states Kestutis Juscius, Chairman of the Board of AUGA group.
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