Aqua Marina, the holding company for Olerex group in Estonia, has signed a binding agreement to acquire the Latvian petrol stations and convenience stores chain KOOL Latvija.
“We have been cooperating with our good neighbours the Latvians for many years,” commented Antti Moppel, Board Member of Aqua Marina, after signing in Riga. “Entering now directly into Latvian market, we bring in our market power, experience, and innovative mind, which will add value not only to KOOL Latvija, but to the whole Latvian petrol industry. Our strategic goal is to become a leading Latvian fuel and convenience retailer.”
“Developing KOOL and its network of fuel stations and convenience stores has been a challenging 3-year period, yet we are happy to have been part of their rapid growth journey,” said Mārtiņš Jaunarājs, partner at KOOL’s biggest shareholder Baltcap Growth Fund. “Now, when KOOL has established its market position, we have accomplished our main goal as growth capital provider. We are thankful to the management team and to our fellow investors for their contribution in developing the business. Considering Olerex leading market position in Estonia I trust Olerex will write the next successful chapter in KOOL´s growth story,” Jaunarājs added.
Normunds Igolnieks, partner at ZGI Capital, which provided KOOL with the initial growth capital back in 2016, partially sourced from the state-owned development finance institution ALTUM: “We have been with KOOL since its inception and are truly pleased with the swift development of the company, which has now been appreciated also by Olerex”.
Sandis Šteins, KOOL Latvija CEO and concept author, will continue managing the company. “Becoming the Latvian branch of Olerex international retail network opens up many new opportunities for our customers and accelerates our growth speed,” he emphasised.
After acquisition of KOOL Olerex becomes the only fuel company of Baltic origin, whose stations cover all three Baltic states.
Law firm Walless advised the sellers in the transaction, whilst Palladium law firm were engaged from the buyers side. The transaction was co-financed by SEB bank.
Aqua Marina is the holding company for Olerex and Olerex Terminal with 200 million euros in assets, established in 1990. Aqua Marina is fully based on the Estonian domestic capital.
Olerex is the Estonian fuel retail market leader with 100 service stations in Estonia and 5 stations in Lithuania. Olerex international fleet card for business customers is accepted in 5000 stations in the European Union, Ukraine, Belarus, Russia, and Kazakhstan.
Olerex Terminal is the owner of a 78 000m3 marine oil terminal in port Tallinn customs-free zone, which is one of the most versatile and technically advanced terminals in the Baltic region. Olerex Terminal is the Estonia’s biggest taxpayer.
KOOL Latvija is the ninth biggest Latvian fuel retailer by sales volume with 10 service stations mostly in Riga and suburbs, but also in Jelgava and Valmiera.
BaltCap is the largest and most experienced private equity investor in the Baltics covering buyout, growth, venture, and infrastructure investments. Since 1995, BaltCap has invested in over 100 companies across a wide range of industry sectors and raised aggregate capital of over €650 million. BaltCap has a team of 35 investment professionals working across Tallinn, Riga, Vilnius, Warsaw, Helsinki and Stockholm offices.
ZGI Capital is one of the most experienced venture capital firms in the Baltics that started its operations in 2005. The investment period has been concluded for three generations of funds: ZGI-1, ZGI-2, ZGI-3 and now we are in investment period of ZGI-4 fund. ZGI Capital has won VC & PE sector awards for four consecutive years: in 2014, 2015, 2016, and 2017. ZGI Capital is registered in the Financial and Capital Market Commission as an alternative investment fund manager.
ZGI Capital growth fund ZGI-4 has invested a half million euros in the data technology company RoyaltyRange, which has presence in a number of countries. This is the fund's first investment in Lithuania, made together with other Baltic and Finnish investors.
RoyaltyRange is known for high quality data and specialized tax and transfer pricing tools that are used by international companies and organizations in more than 70 countries already. In addition to existing products RoyaltyRange is developing a new major database product.
The target global market for data is worth billions of euros. RoyaltyRange's ambition is to offer customers an innovative and easily configurable platform through state-of-the-art IT infrastructure that uses automatic data collection tools. Investments from ZGI-4 and other funds will help to launch this product on global scale.
Krisjanis Rullis, Investment Director of ZGI Capital:
"We are pleased to support RoyaltyRange and its international team of experts that have managed to create an easy-to-use platform for complex information and data products. With the new database product, the company has taken another step forward basing it on data automatization and robotic algorithms. It may take years for competitors to reach this level of product development, so this is the right time to support the launch and global sales.”
Kestutis Rudzika, RoyaltyRange, Director: “RoyaltyRange is working with the technology which is hard to execute and embraced an engineering challenge which is tough enough to give RoyaltyRange an edge. We are excited to work with ZGI and other funds to pursue our vision and deliver a lot of value to our customers.”
ZGI Capital, alternative investment fund manager, with venture capital fund ZGI-4 has invested EUR 2 million in HansaMatrix to enhance the company's growth and competitiveness. As a result of the transaction, ZGI-4 Fund has become a 15.06% shareholder of HansaMatrix.
The financing will support HansaMatrix’ ongoing growth strategy and the ongoing shift from manufacturing towards offering a full range of services, including value added design, engineering and aftermarket services. The investment of the ZGI-4 venture capital fund will be used to replenish working capital and purchase technological equipment.
HansaMatrix CEO Ilmārs Osmanis commented: “We are proud to attract ZGI Capital – reputable Latvian investor in our professional investor group. Received funding will be used to continue allready started investment program to develop HansaMatrix as a technological leader in the production of optical and electronic systems in the Baltic – Nordic region.”
Rudolfs Krese, Investment Director of ZGI Capital added: “We have closely followed Hansamatrix's development and are pleasantly surprised by its rapid growth, service quality and speed. We are pleased to invest in the company that have consistently implemented an investment programme and can continue to support further implementation of this business plan with our contribution. Regular investments in automation, modernisation and the development of manufacturing technologies have allowed Hansamatrix to become a true high-tech company. With this investment, we continue to pursue the growth capital fund's ZGI-4 strategy - with funding, the company will implement a development investment programme and continue to pursue the main goal of growing from a Baltic player to an internationally recognised leader on a global scale."
HansaMatrix is a fast-growing, high-technology company offering product design, industrialization and complete manufacturing services in data networking, Internet of Things, industrial segments and other services to high added value business segments. In addition to complete manufacturing services of OEM products, the company offers an ODM business model to both start-up and established companies that seek product development partnerships.
ZGI Capital is one of the most experienced venture capital fund managers in the Baltics and has been operating since 2005. Currently, ZGI Capital manages the fourth generation growth capital fund ZGI-4.
Additional information available in the documents (in Latvian language) attached.
Māris Macijevskis, CFA
Management Board Member, Finance director
Phone: (+371) 6780 0002
ZGI Capital is one of the most experienced risk capital fund managers in the Baltics and has been operating since 2005. Currently, ZGI Capital manages the fourth-generation venture capital fund ZGI-4, whose largest investor is ALTUM.
The core business of Corle OÜ is the design, construction and maintenance of electrical and internet optical cable engineering systems. The company's turnover in 2018 reached EUR 7.1 million (27% increase over the previous year) and is projected to be more than doubled over the next few years. The company's home market is Estonia and Finland, and the first pilot project has been completed in Sweden. Currently negotiations have started to launch first project also in Germany.
The company is not a typical development story, as only recently at the end of 2017, current owner and CEO, Priit Uuemaa, who previously gained a high level management experience in one of Estonia's largest companies, Graanul Invest AS, saw potential, and acquired Corle OÜ using mezzanine debt (leveraged buyout).
Priit Uuemaa comments: "The company does not want to stop at current achievements and plans to expand further in the Baltics and Scandinavia, and ZGI investments are an important step towards achieving these goals".
Edgars Cimermanis, Investment Director of ZGI Capital: "The strategy of the fourth generation fund" ZGI-4 "managed by ZGI Capital provides an opportunity to diversify the fund's operations by investing in prospective companies also from other European Union countries outside of Latvia. We highly value Corle managements experience, qualifications and achievements shown during the previous year very successfully working in an engineering-solution-intensive industry with extensive development capabilities. The company has ambitions to continue expanding its business by expanding operations internationally, including in Latvia. We are pleased that, with this investment, we also have opportunity to take part in the company's growth story.”
The capital raising process was led by Auctus Capital. Auctus Capital partner Ēriks Reņģītis comments: “Auctus Capital specializes in capital raising for fast-growing companies, where traditional financing source are not enough. Considering that ZGI is backing ambitious companies with high growth potential also outside of Latvia, we believe that the fund is the right partner for Corle OÜ management goals”.
Juris Vaskāns, Member of the Board of ALTUM: “The Growth Risk Capital Fund ZGI-4 provides an opportunity for companies that need investment for further growth but who do not qualify for traditional commercial banking products. A quarter of the fund's investments are made in European Union companies outside Latvia, and one such perspective investment is made in Corle OÜ.”
One of the most experienced venture capital fund managers in the Baltic States, ZGI Capital, has attracted private investments of 10 million EUR to the newly founded capital growth fund ZGI-4. At present, it is the largest private investment raising in Latvia for a state co-financed capital growth fund. The largest amount, or 7.5 million EUR, was invested in the ZGI-4 fund by Swedbank Ieguldījumu Pārvaldes Sabiedrība AS, which will increase its contribution to 11 million EUR as other investors are involved. It is planned that the new fund will invest both in the traditional industries of the Baltic States, and in the so-called new sectors of the economy, such as fintech companies.
ZGI Capital received the LVCA's award Exit of the Year for sale of company Art Fairs Service. Successfully implemented strategy allowed to achieve the goals and resulted in a fruitful exit.
Tradition of the “Investor of the Year” award was introduced in 2015 as a result of the cooperation of the Latvian Private Equity and Venture Capital Association (LVCA) and the Latvian Business Angel Network (LatBAN). The goal of the initiative implemented by LVCA and LatBAN is promotion of the investment sector development in Latvia by expanding the network of investors. Through identification and popularisation of the most successful investments of the year, the organisers would like to draw attention to the significance of the comparatively new sector in Latvia in supporting the viable projects.
— TechChill (@TechChill) November 22, 2017
On 16 November 2017 a contract was signed for the creation of a new venture capital fund “ZGI-4”, which will be managed by venture capital fund manager “ZGI Capital”. Currently, the fund is engaged in attracting private funding to start working on the first fund investments in summer of 2018.
Venture capital is a long-term equity investment in companies with high growth potential, boosting their value growth, growth speed and expansion
Venture capital investments can be made as investments in a company’s equity capital or quasi-capital
Venture capital provides opportunities for companies with high growth potential and innovative enterprises which do not receive investments from traditional financiers due to high risk
The volume of investments can reach EUR 3.75 million in one enterprise
The investment period – up to 5 years
The investor becomes a business partner, sharing the risks and the income of the company, and who provides the company with his experience, knowledge, access to a range of contacts and experts, with an intention of enhancing the company’s turnover, profitability and value
Venture capital investments are made to increase a company’s value by funding its growth and development
Venture capital fund ZGI-3, which is managed ZGI Capital, has sold its 28% stake in the exhibition services company Art Fairs Service.
The company was registered in the spring of 2014, and turned to the investment fund seeking financing necessary for buying equipment. The company has successfully found a niche for itself thanks to innovative technical solutions and original logistical and workflow organization procedures. It enabled the Latvian company to compete with similar companies abroad, which had been in the business for years. It proves that, even in such a seemingly traditional business as organization of and providing equipment for exhibitions, innovative approach can lead to success.
The company has been steadily expanding into new markets. In 2016, Art Fairs Services organized exhibitions in Belgium, Sweden, Netherlands, Germany, Italy, Great Britain, Denmark, Spain and Latvia. Exports account for 99% of the company’s turnover. Art Fairs Service is planning further growth on European markets and also expand into Middle East by employing new business models.
Art Fairs Service earned high marks in the Investment and Development Agency of Latvia’s Export and Innovation Award competition 2016, category Best Exporter, and in the Latvian Export Product 2014 competition organized by the Export Council of Latvia.
The Minister for Economics Arvils Ašeradens addressed the winners of “Investor of the Year ‘16” and investment professionals and emphasised: “Today we are honouring projects with the highest possible added value. Modern and innovative economics cannot exist without the smart or venture capital. Healthy development of the eco-system of innovations, in turn, cannot exist without investments of business angels. Funding of venture capital or smart investments provides the entrepreneurs an opportunity to receive not only additional investments, but also support from experienced experts for the implementation of their ideas. Meanwhile, business angels are like messengers of approaching spring. Intuition, knowledge and courage of business angels raise the potential of the national exports, which is the safest development for the national economy.”
“The year 2016 was a productive year in the sector of private and risk capital. The members of the LVCA have made over 50 investments, providing financial support in the amount of more than 15 million euros to companies operating in different industries. I would like to stress that the contribution of other professional participants of the market, lawyers and financial specialists, is also of importance. This is a joint action resulting in the growth and development of the Latvian investment environment. All the winners of the “Investor of the Year ‘16” award in the sector of legal entities are visionaries of our industry whose working results and contribution we can assess with the mark of the top quality,” said Edgars Pīgoznis, Chairman of the Board of the LVCA.
The Schaeffler Group has acquired Latvian company “SIA Naco Technologies” in Riga. Naco Technologies has unique expertise in the development of new coating systems. Schaeffler is the market leader in functional surface technology in several market segments. Acquiring this highly innovative service provider will help strengthen Schaeffler’s core expertise in this technology of the future.
The start-up company “SIA Naco Technologies” was founded in Latvia’s capital in 2010 with the support of “Commercialization Reactor Riga”, an agency and marketing platform for science-based young businesses. As just one example, the specialists from Latvia have developed what is currently the fastest process for physical vapor deposition (PVD). This technology will complement and further optimize Schaeffler’s high-tech vacuum facilities for PVD and plasma-based PACVD processes that are used in high-volume production. Naco currently has six employees.
Prof. Peter Gutzmer, Deputy CEO and CTO, regards this acquisition as a strategic addition to one of Schaeffler’s key competencies.
“It underlines our claim to technology leadership in coating technology. Our experts are especially important in ensuring the implementation of value adding steps that are essential for quality, functions and costs for important products and components. By acquiring Naco, we have secured the experience and expertise of a scientist highly renowned in the scientific community, five highly-trained specialists and an innovative prototype PVD facility.”
In addition to product and technology expertise, Schaeffler thus also expands its industrialization and value added competencies in surface technology, securing the entire knowledge about this key technology in-house.
For Dr. Yashar Musayev, Senior Vice President of the Competence Center Surface Technology, his new colleagues in Riga are an ideal addition in this field:
“Naco Technologies has been instrumental in promoting the development for particularly environmentally friendly and innovative PVD processes. With Professor Valery Mitin, the company has an internationally renowned expert at its helm. Going forward, we will be able to benefit exclusively from his experience and his team.”
Prof. Mitin is the co-founder of this young company and has more than 40 years’ experience in research, development and production in the nano industry from his work at the “Moscow High Technology Science Research Institute of Non-organic Materials”. He was the world’s first designer of a PVD system. Seventy-one-year-old Prof. Mitin is looking forward to working with the specialists at Schaeffler:
“I would like to contribute my knowledge and the results of our work at one of the most innovative and leading global companies for surface technology. Together we will be able to advance the development of new and even better coating systems and achieve a quantum leap for production methods.”
Schaeffler carries out coating at over 20 locations around the world in more than 50 modern coating machines using a range of methods and technologies, such as spraying and painting procedures as well as chemical and physical processes such as PVD/PACVD. Several million parts with added value through coating technology were delivered from the plants of the Schaeffler Group last year.
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The Schaeffler Group is a leading global integrated automotive and industrial supplier. The company stands for the highest quality, outstanding technology, and strong innovative ability. The Schaeffler Group makes a key contribution to “mobility for tomorrow” with high-precision components and systems in engine, transmission, and chassis applications as well as rolling and plain bearing solutions for a large number of industrial applications. The company generated sales of approximately 12.1 billion euros in 2014. With more than 82,000 employees, Schaeffler is one of the world’s largest technology companies in family ownership and, with approximately 170 locations in 50 countries, has a worldwide network of manufacturing locations, research and development facilities, and sales companies.