"Sale of Daumantų LT factory in Kaliningrad still pending

The deal for the sale of the Russian Kaliningrad plant „Agroprodukt“, which was announced as early as 2022, by the Lithuanian sauces and condiments producer „Daumantai LT, has not been finalised and has been stalled indefinitely.

Saulius Grinkevičius, the Group's CEO and shareholder, told BNS that the contract for the sale of the Dutch company „KL Food Group BV“, which owns 65% of „Agroprodukt“, was signed as early as 2022, but that the deal has not been completed because the Russian buyer is not yet able to pay the full amount of the money, due to the European Union's sanctions.

„(Russian buyer – BNS) excuses that we cannot transfer (the money – BNS), and in fact, as far as we have explained, they really do not have the capacity to transfer to EU banks. (...) They transferred a small amount while the money was still walking around and that was the end of it," the head of „Daumantų LT“ explained to BNS.

In addition, he said, the Dutch notary's office that handled the deal cannot carry out any transactions with Russia. 

„The other reason is that the Netherlands, under EU law, has suspended those dealings with Russia, and that's why things are in limbo here.) (We gave the sale and purchase agreement to the notaries, I mean the Dutch, and they were stretching, stretching and then they take it and tell us that they have found the clause where it is written that the legal institutions of the European Union cannot execute any transactions with Russian companies“ – BNS quoted Mr Grinkevičius as saying.

According to him, „Daumantai LT“ is only the formal owner of „KL Food Group“, and the income of the Kaliningrad plant stays in Russia, „Daumantai LT“ receives no financial benefit from it.

„The Russians (the buyer of the company – BNS) can't transfer the money because the bank doesn't allow transfers, the Dutch notaries can't complete the transaction because of the EU directive. In principle, we gave the factory to Russia and they are happy to live there, receive the money and sit there laughing," Grinkevičius said.

He said that the group agreed to sell its controlling stake in the factory for „much less than „Viciunas“ and that the stalled deal has resulted in losses amounting to „several million“. 

BNS reported that „Vichyunai Group“ sold its business in Russia and other Eastern markets last year for around 102 million euros.

„We are thinking of all sorts of options here to do all this. It comes full circle and then it goes round and round again," the group's chief executive told BNS.

„Daumantai LT“ in response to Russia's 2022 invasion of Ukraine, „KL Food Group BV“ signed a sale and purchase agreement with an unnamed Russian buyer in June of the same year.

S. Grinkevičius said at the time that it was one of the most difficult decisions he had to make, as he had to accept large losses, organise the sale of shares under special conditions, and the desire to sell the factory as soon as possible was a civic position. 

The company did not disclose at the time the amount of the transaction, the other terms and conditions, or the buyer's confidentiality agreements. Nor is this information disclosed in the company's accounts for the last three years.  

„Daumantai LT“ announced in April 2022 that it has no control over the Kaliningrad plant and has no option to close it down, and is therefore looking for a buyer for the stake. Before the war, „Agroprodukt“ supplied the company with raw materials and containers for its products, as well as buying some of its products.

The portal lrt.lt reported at the time that the rest of the shares in the Kaliningrad company were held by Artūras Pauliukaitis, the head of „Agroprodukt“, and Valeriy Samoilenko, a businessman from that area, who owned 21% and 14% respectively.

„Daumantai LT“ in 2024 earned a consolidated net profit of EUR 883.6 thousand – 18.1% more than in 2024 (EUR 748.3 thousand) and consolidated revenues of EUR 12.63 million – 2.4% less (EUR 12.94 million), according to the company's report submitted to the Register Centre.

The company paid out €295k in dividends last year (€300k in 2023), it said.

„In the financial year (2024 – BNS), the group's activities have changed substantially compared to previous periods. The Group produces and sells food products, demand for its products is stable and there have been no restrictions on its activities, – the report says.

This year, the group plans to maintain its 2024 turnover, it said.

„In 2024, the focus was on upgrading production facilities. As in every year, investments will be made in the purchase of new equipment in 2025," the document says. 

In addition to the Dutch company, the group consists of the parent company „Daumantai LT“, VMGH and its subsidiary Vilniaus majonez Gamylas, „Mugės redakės“, „Papes Residence“ in Latvia „Papes Residence“, and the activities of „Kėdainių žinios“ and „Mobilaus maisto“ have been suspended.

45.06% of „Daumantų LT“ shares are held by S. Grinkevičius, 44.94% by „Robertas Neimontas, according to the data of the Centre of Registers.   

The average number of employees in the group last year was 81.