March 14 2008, 09:55

Project Line Finance to construct the cannery in Rostovskaya region

The company Project Line Finance plans to construct the cannery in Rostovskaya region; its tentative capacity will be 50 mln. of the conditional jars per year. The project of around EUR 18 mln. will possibly be implemented in Semikarakorskiy district. To the experts' opinion, the construction will take place on the basis of the available cannery in Semikarakorsk.

Project Line Finance was founded in 2004 by the private entities. The company became the partner of American GIC Group in 2006. The joint enterprise provides foreign and Russian businesses with the integrated solutions in the funding and financial consultation for the implementation of the investment project predominantly in the agri-industrial sphere. The company does not release the financial data.

The representatives of Project Line Finance and Vyacheslav Vasilenko, the Minister of Agriculture of Rostovskaya region, conducted the preliminary negotiations about the project implementation. "The company will make the final decision by the end of March", the source of the Regional Ministry of Agriculture informed RBC Daily. The source pointed out that in case of the positive decision the company was ready to construct the plant on a turn-key basis in two years.

The representatives of Project Line Finance in their interview to RBC daily confirmed the fact of the negotiations. "The speed of the project implementation will depend on how soon we are able to reach the common understanding with the Ministry of Agriculture of the region", the representatives of the company Press Service added; they pointed out that the Rostov partners will be fully responsible for the choice of the construction plot. The representative of Project Line Finance made no comments about the nature and the definite sum of the investments.

Oxana Khomich, General Director of the multiple-purpose marketing agency "BusinessAnalitik" thinks that the production will probably be set up on the basis of the already existing cannery in Semikarakorsk. The Regional Administration has been offering this cannery to the potential investors for a long period of time. "The sum of around EUR 20 mln. is quite enough to update the production; a part of this sum will be surely allocated for the marketing", the expert thinks. According to Mrs. Khomich, only the price competition exists today on the market of canned products in Rostovskaya region: around 30% of the demand are satisfied by the available supplies from the point of view of the branding.

Igor Zakhidov, the Director of Rostov representative office of the investment-financial company "Solid" thinks that predominantly Southern Federal Okrug will become the sales market for a new plant. He observes that the sum of the investments may amount to EUR 30 mln. in this case. To his opinion, the payback period of this project may last for 7-10 years. Oxana Khomich thinks, five years are enough if the there is no construction from the ground up.

According to the data of the Investment Development Agency of Rostovskaya region, the area of Don has the potential for the creation of two-three plants for canned fruits & vegetables and juices production of the capacity at least 60-100 mln. of conditional jars each. This source estimates one project to cost around EUR 32 mln. At the present moment the authorities of Rostovskaya region offer the potential investors five land plots on the territory of the region for the construction of the canneries, including the land plot in Semikarakorskiy district.