Kauno Grūdai has acquired shares of Auga Group. Under the terms of the agreement, the buyer will acquire the shares of Auga Group’s soup and canned products production unit Grybai LT.
The acquired company, Grybai LT, operates a robotic factory covering an area of around 3,600 square meters (38,750 square feet). The main products include ready-to-eat organic soups, curries, cereal meals and organic vegetables in packets, around 70 product names. The annual production is 8-9 million packets of various products, which are exported to more than 30 countries. In 2022, Grybai LT's revenue totaled EUR 7.1 million.
“We have agreed that for 18 months we will be able to use the Auga brand for ready-to-eat soups, stews, and cereals. Afterward, we will replace it with our own brand—Activus, which is aimed at active and busy people who take care of themselves, especially the younger generation,” says Andrius Pranckevičius, CEO of AB Kauno Grūdai.”
Offering customers a line of organic and eco-conscious soups, stews, cereal dishes and organic vegetables in packets is a new segment for Kauno Grūdai, but the company says this will also lead it to previously unexplored markets such as North America and Asia.
The acquisition of Grybai LT holds significance for Kauno Grūdai, as it complements the company’s production with a section of organic, ready-made food products. Furthermore, it provides an opportunity to explore new markets for other products produced by the company, such as instant noodles, instant porridges and others.
The company decided to go ahead with the deal because it is interested in growing in the food products market and adapting to consumer demands. ”Our goal is to expand by diversifying our activities, and the most appealing option appears to be expansion in the ready-made food segment. following the acquisition of Grybai LT, three new product groups will be added to our portfolio,” says Pranckevičius.
The company’s line of instant noodles products is established in the EU market, having partnered with 30 of the EU's top supermarket chains. Kauno Grūdai hopes to expand manufacturing to 24 hours a day and sell additional goods to clients who already buy its instant porridges and instant noodles in the EU.
To accomplish these goals, Kauno Grūdai plans to invest an additional €4.4 million over the next 5-6 years to boost its maximum manufacturing capacity to 33 million packets or 11,000 tons per year.