Romanian agri investment firm to fill grain storage gap

A listed Romanian agriculture investment firm is aiming to fill a gap in the country’s storage space for grains by constructing a logistics centre with the proceeds of a recent land sale.

Agrar Invest Romania has sold a farm estate at a 50 percent premium on its balance sheet value, according to a press release on the company website.

The property was bought by Agrar Invest’s subsidiary Zarand Estate in spring 2012 outside the firm’s core area of ownership in the Mures Valley.

“This transaction proves that substantial hidden reserves are held in Agrar Invest Romania AG’s portfolio of agricultural land,” wrote Theo Hani, the Swiss managing director of the firm, in a statement on the firm’s website.

The firm will reinvest the proceeds into the construction of a logistics centre which will include a silo for storing organic grain, and cleaning, drying and disinfestation facilities.

“This will help to fill a gap in Romania, as the country does not currently have sufficient storage space for organic cereals, nor adequate cleaning, drying and disinfestation facilities,” reads the release. “Because buyers of organic cereals want to be able to trace the goods back to the producer, the storage concept for organic grain is significantly different from conventional installations.”

The company will also continue to consolidate its land in Mures Valley.

Agrar Invest listed on the Düsseldorf stock exchange in August 2011 and is currently trading at €1.051 a share, down nearly 7 percent since the start of 2015. It charges a 1.3 percent management fee.

“Agrar Invest Romania invests its capital in sustainable managed agricultural land, industrial land and organic assets in Romania,” reads a fact sheet on its website. “Through its holdings, the Company purchases farmland, produces and sells foods, owns organic assets and maintains farms, machinery and plants.”

Agrar Invest was not reachable for comment before Agri Investor went to press.