SigmaBleyzer exits Romanian dairy producer

The Eastern Europe-focused investor has exited Covalact after the deal with French dairy group Lactalis was approved by Romania's competition council.

Texas-based private equity firm SigmaBleyzer has sold Romanian dairy producer Covalact after its acquisition by French dairy group Lactalis was authorized by Romania’s competition council.

Covalact was acquired by SigmaBleyzer in 2007 and the sale represents an exit for the firm’s Southeast European Fund IV, a 2005-vintage €250 million vehicle.

Concerned about the potential monopoly effect on butter production in the country, in its ruling the council said Lactalis must transfer the license for its LaDorna butter brand to another company, and that company must re-brand the product.

The deal adds to Lactalis’ dairy exposure after its acquisition last year of the country’s biggest dairy producer Albalact from Romanian private equity fund RC2. Lactalis owns international dairy brands such as President and Parmalat.

Eastern Europe-focused firm SigmaBleyzer also owns Ukrainian grains and oilseed producer AgroGeneration. In 2012 the Overseas Private Investment Corporation, the US government’s development finance institution, invested $50 million in SigmaBleyzer’s Southeast European Fund IV after the fund had called 100 percent of committed capital.

Covalact recorded a turnover of €44.9 million and a net profit of €1.3 million in 2016, according to its website.