US investment fund SigmaBleyzer confirmed it is to enter the Romanian dairy market to tap into growing potential in the country.
The investment comes as a further indication of the growing opportunities for dairy processors in the country, particularly in terms of yogurts and cheeses. Radu Bugica, manager of the group’s Romanian operations, told DairyReporter.com that it had completed the acquisition of a stake in local group Covalact. However, he was unable to confirm reports in the local press suggesting that it had acquired a majority 70% stake in the operations for about €7 million ($9.6 million).
The fund has previously made investments in the country’s construction and food processing industries. However, Bugica said the group had taken the decision to enter dairy production as a result of increasingly favorable market conditions. Covalact produces a wide array of dairy goods, including milk products, yogurts, cheeses and butter. By acquiring a stake in one of the country’s major dairy suppliers, Bugica said that the group would be able to better meet local demand, with consumers remaining fiercely loyal to Romanian brands over foreign products.
SigmaBleyzer is not alone in its optimism over the prospects for the country’s dairy production. Between 2005 and 2008, the total value of dairy products in the country is expected to increase by €150 million to €633 million ($205-$866 million), according to consumer analyst Euromonitor. This growth will be driven most significantly by sales of yogurt, sour milk drinks and cheeses, the forecasts found. (foodtechnology.ru)