Investment bank BG Capital successfully completed the secondary private placement of a 17.2% equity stake in one of Ukraine's largest agro holdings, Sintal Agriculture (Frankfurt Stock Exchange ticker: SNPS GF). Depositary receipts were placed at US$ 2.28, which yielded placement proceeds of US$13mn and implied a company capitalization of US$ 75mn.

The transaction involved the placement of 5.7mn depositary receipts, issued by Deutsche Bank (with a common stock to depositary receipt ratio of 1:700), which were listed on the Frankfurt Stock Exchange.

BG Capital acted as the sole placement agent and bookrunner on the transaction.

Seventeen international investment funds, along with a number of private investors, from Europe, Russia and the US took part in the placement. Following the transaction, the share of international investors in Sintal's shareholder equity exceeds 35%.

Proceeds from the placement will be used to complete the acquisition of a grain elevator in Crimea and finance the construction of a new elevator in Kharkiv Oblast, with overall storage capacity of 215,000 tonnes. The company will also expand its land bank by acquiring more than 20,000 hectares of irrigated land in Kherson Oblast.

Nick Piazza, CEO, BG Capital: “I’m extremely pleased with the success of this deal. BG Capital can now proudly claim to have completed the only large Ukrainian equity placement in 2009. This deal also marks a turning point in how investment banking is conducted in Ukraine, as investors have evolved and become much more demanding, and now look for higher-quality, value-focused deals.”

Vadim Mogila, CEO, Sintal Agriculture: “This was an extremely timely transaction, as we believe it will trigger a breakthrough in our development at reasonably low cost. The construction of a new grain elevator will cost us only one third of the price we would have paid last year. Our improved infrastructure and increased land bank will make our company more competitive and enable us to bring even better returns for our shareholders.”

Sintal Agriculture is one of Ukraine’s leading agricultural holdings with a land bank of over 100,000 hectares in Kharkiv and Kherson Oblasts. Sintal cultivates more than 85,000 hectares of its land bank, which includes 20,000 hectares of irrigated land. In 2008 Sintal reported US$ 37.7mn in net revenue, operational profit of US$ 21.3mn, and net income of US$ 14.1mn, according to its consolidated audited financials under IFRS. For more information, please visit the company's website www.sintalagriculture.com.

For more information on BG Capital equity financing deals, please see bgcapital.ge/en/investment-banking/.