15 Mar 2023 10:48

United Tea Co eyeing Russian assets of Lipton tea maker

MOSCOW. March 15 (Interfax) - United Tea Company, a Russian producer of tea and coffee, is looking to acquire the Russian assets of Ekaterra, the Netherlands-based producer of teas under the Lipton, Saito, Brooke Bond and other brands.

Russia's Federal Antimonopoly Service (FAS) said it has received an application from United Tea Company LLC for preliminary approval to acquire the main manufacturing facilities and intangible assets of Ekaterra LLC.

Ekaterra announced last summer that it was leaving Russia due to the "current operating environment" and planned stop making Lipton, Saito and Brooke Bond teas in the country by the end of 2022.

Ekaterra was previously owned by Unilever, which sold its tea division to CVC Capital Partners VIII for 4.5 billion euros at the beginning of 2022.

United Tea Company is 50% owned by Alexander Konov, data from the Unified State Register of Legal Entities showed. JSC Luzhniki CEO Alexander Pronin and Larisa Pronina each own 25% of the company.

United Tea produces tea under the Eastford, Berryford, Kama Sutra and Zeleny Standart brands, and also packages products under contract, including for retail chains' private labels, national daily Kommersant reported. Konov is the director of the Petr Konchalovsky Foundation founded by directors Nikita Mikhalkov and Andrei Konchalovsky.

Ekaterra produced tea at a factory in St. Petersburg that, according to the city administration, had capacity to produce up to 16,000 tonnes per year as of 2019.

The Russian tea market totals about 140,000 tonnes per year, so Ekaterra's factory could have more than a 10% share of the market, Kommersant said, citing an estimate from the Roschaikofe association. Ekaterra's Russian assets have been valued at about 750 million rubles, the paper said, citing a source.

United Tea closed 2021 with a net profit of 475,000 rubles on revenue of 136.8 million rubles, compared to 756,000 rubles and 121.8 million rubles, respectively, in 2020. Ekaterra LLC posted a net profit of 52.5 million rubles on revenue of 88.6 million rubles in 2021.