Serbia-based Don Don has become the largest industrial bakery in the markets of the former Yugoslavia after the takeover of Slovenia’s Pekarna Grosuplje.
The deal is worth €60 million and incorporates loans by regional commercial banks as well as the Finland-based KJK private equity fund, an existing minority shareholder of Don Don. The EBRD will provide €10.3 million.
Originally funded as a small bakery in Slovenia in 1993, today Don Don is the leading industrial bakery in Serbia. The company is also active in Slovenia, Bosnia and Herzegovina, Montenegro, Bulgaria and Croatia, with plans for expansion to Romania and Albania. In April 2014, KJK acquired a 25 per cent stake in the company, with the proceeds invested in further expansion.
Pekarna Grosuplje, established in 1951, became the in-house baker of Slovenian retailer Mercator in 2008. Following the takeover of Mercator by Croatia’s Agrokor in 2014, the bakery was earmarked as a non-core asset, but will continue to supply the retailer. Pekarna Grosuplje will also become the center of Don Don’s activities in Slovenia and Croatia.
The acquisition will enable the consolidation of a market suffering from fragmentation and inefficiencies and also serve as a platform for further expansion in the region. Together with Pekarna Grosuplje, Don Don is targeting an annual turnover of about €100 million in 2016.
© 2015 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic. To subscribe to ESM: The European Supermarket Magazine, click here.