E-Malt.com News article: 2080

Russia's Avangard bank is setting up a subsidiary, Avangard-Agro, that will be responsible for high-quality barley supplies to the bank-controlled malting plants, Kirill Minovalov, CEO of Russky Solod (Russian Malt) said on January 22, according to Prime-Tass.

Russky Solod is a malt-producing company, fully owned by Avangard bank. All the necessary documents have already been submitted for registration, Minovalov said. The bank will hold 49% in the new company, while the bank's shareholders will hold the remaining 51%, he said.

Avangard-Agro's operations will include supplying high-quality seeds and necessary equipment to the farms, as well as monitoring the production technology and quality of crops. It is expected that this agricultural marketing year will bring in 150,000 tonnes of high-quality malting barley, while in the future barley supplies amounting to 380,000 tonnes will meet the needs of all Russky Solod's three malting plants.

According to Minovalov, earlier Avangard was considering selling its malt business but later rejected the idea. Instead, in two or three years Avangard plans to control all malt operations, from production of barley to its processing into malt. In particular, the bank is considering building mini-elevators, Minovalov said.

Avangard bank has so far invested over U.S. USD 70 million in construction of three malting plants, which are located in the Moscow, Voronezh and Oryol regions, while total investment is estimated at about USD 100 million. The malting plant in the Moscow Region is already in operation, while the plant in the Voronezh Region is to be launched in spring, and the Oryol plant, at the end of this year or beginning of 2005. The three plants are expected to account for 30% of Russia's total malt production.


23 January, 2004