Agribusiness fund in $143m Russian chicken deal

As private equity interest in Russia picks up, Burlington Capital Group has sold Russian poultry producer Chicken Kingdom to meat processor Cherkizovo Group for $143 million.

Omaha, Nebraska-based investment manager Burlington Capital Group has sold Chicken Kingdom to Russian meat producer the Cherkizovo Group for $143 million (€105 million), plus the assumption of debt.

Chicken Kingdom is based in Lipetsk and Bryansk, Russia. In 2006 the company reported sales revenues of $109 million, according to a statement.

Burlington invested in the Russian poultry processor through its Agribusiness Partners International fund, a $100 million vehicle formed in 1996 to target investments in food and agribusiness companies in the former Soviet Union. The Overseas Private Investment Corporation, a US government agency, is a limited partner in the fund.

“Over the years, API has built Chicken Kingdom into a well known brand and a respected company,” API president Bob Peyton said in a statement.

The fund’s other investments include Bagrationi, a Georgian producer of sparkling wine and Global Ice Cream, a premium ice cream maker in Kazakhstan.

Chicken Kingdom is the fund’s fourth exit to date. Previously, the fund sold its stake in Acodec, an operator of two dairy plants in Russia, Foodmaster International, a producer of dairy products in Kazakhstan, and Saint Springs, a Russian bottled water producer.

Other private equity firms are showing interest in the Russian food products sector as well. UK buyout firm Lion Capital bought Russian juicemaker Nidan Soki earlier this month. Russian paper Kommersant also reported that TPG is in talks to acquire a stake in Russian supermarket chain Seventh Continent.