Viktor Nauruzov’s meat empire shake-up: “Tsaritsyno” faces aggressive takeover by GAP “Resurs”

17:19, 03.06.2021

1562

Viktor Nauruzov’s meat empire shake-up: “Tsaritsyno” faces aggressive takeover by GAP “Resurs”

A new co-owner has joined Moscow’s Tsaritsyno Group, one of Russia’s leading meat producers. The stake was acquired by a former top manager, possibly on behalf of an investor consolidating industry assets.

Kommersant sources indicate the investor could be GAP Resurs, the nation’s second-largest poultry company, currently buying meat-processing facilities. Internal complications within Tsaritsyno may affect the deal.

Data from the Russian Unified State Register show Yevgeniy Shalaginov obtained 50% of Novy Partner LLC, a parent company of the group, in late May.

Previously, the company had been owned equally by Tsaritsyno’s main shareholders, Lena Alenkina and Vyacheslav Kalugin, who has now exited the list of founders. Novy Partner owns 42.47% of Tsaritsyno JSC, while Alenkina and Kalugin each directly hold 27.72%, according to the company’s 2019 report. Tsaritsyno produces more than 500 types of sausage products and ranks among the top twenty players in Russia’s sausage market. In 2019 the group produced 45,470 tons of products. In 2020, Tsaritsyno JSC reported revenue of 4.06 billion rubles and net profit of 59.07 million rubles.

Yevgeniy Shalaginov previously served as director of the FMCG new projects implementation practice at the consulting firm Strategy Partners. He worked on integrating the distribution of Ivan Taranov Breweries after the asset was sold to Heineken, and oversaw the sale of Golden Terem Group (Barentsev snack brand) to KDV Group. In 2020, Shalaginov became CEO of Tsaritsyno Branded Trading House JSC. According to sources close to the group, he was hired to sell the asset to a strategic investor. Potential buyers reportedly included structures affiliated with AVG Capital Partners, a fund linked to Rustem Mirgalimov. However, those negotiations were unsuccessful. Tsaritsyno’s office did not respond to inquiries, while Shalaginov and an AVG representative declined to comment. Lena Alenkina and Vyacheslav Kalugin could not be reached.

According to one Kommersant source, Shalaginov in the Tsaritsyno transaction represents a major investor seeking to create the third-largest player in Russia’s meat products market, after Ostankino and ABI Group, by consolidating several assets around the enterprise.

A senior executive at a large meat producer believes such ambitions could belong to GAP Resurs, the Stavropol-based poultry group owned by Viktor Nauruzov. The company is the second-largest broiler meat producer in Russia (brand Blagoyar) and has recently begun actively consolidating assets in meat processing. In February, the group acquired sausage producer Integra (brands Dym Dymych and Rossiyanka). At the end of May, a Resurs structure filed a petition with Russia’s Federal Antimonopoly Service seeking approval to purchase the assets of the Familnye Kolbasy meat plant in Saratov, which has an annual capacity of 25,000 tons. A Resurs representative declined to comment, while Familnye Kolbasy did not respond to inquiries.

Albert Davleev, president of Agrifood Strategies, says GAP Resurs is building vertical integration by adding deep-processed products such as sausages and ready-to-cook meat products to its portfolio. According to him, this allows the company to operate across wholesale, retail, HoReCa, and export markets while increasing market share. Building new plants today can also be more expensive than acquiring existing ones, the expert adds.

Another industry source notes that GAP Resurs’ business is currently concentrated in southern Russia, where grain prices are higher due to proximity to export ports, which increases the cost of meat production. As a result, the group needs to expand the share of higher value-added products. However, according to industry sources, in the case of Tsaritsyno the deal could be hindered by long-standing management issues within the group and the outdated condition of the asset.