Wimm-Bill-Dann, Russia's largest dairy company, is seeking acquisitions in the milk and children's food sectors but does not plan to cut production despite payment delays from local retailers.
"We will be making some purchases of new enterprises," Wimm-Bill-Dann Board Chairman David Yakobashvili told Reuters in an interview.
"We need new markets, new volumes. This is in the milk and children's food sectors," he said. Yakobashvili declined to name the companies involved or in which countries. "The negotiations have gone a long way and the prices have changed," he said.
When asked how he would finance the acquisitions he said: "We have an agreement with financial institutions that they would easily credit us - we have an EBITDA of $400 million and just $600 million of debt."
New-York listed Wimm-Bill-Dann, seen as a way to buy into Russia's ten-year economic boom, has seen its market capitalisation tumble to $1.9 billion from a year high of $6.4 billion in January, as investors dumped Russian stocks. Russian stock and bond markets have had their worst declines this year since the 1998 crisis on concerns the credit crisis could stall economic growth and undermine the longest Russian growth spurt since the 1970s.
French food group Danone holds an 18.4 percent stake in the company. Wimm-Bill-Dann's founding shareholders - including Yakobashvili - hold a 45.2 percent stake in the company, according to company disclosures.
RUSSIAN CRISIS:
Some major Russian businessmen have been cutting staff and slashing capex as the crisis undermines their ability to borrow, but Yakobashvili said Wimm-Bill-Dann was not planning cuts to its workforce of more than 19,000 employees.He said, though, that the company had approached banks to get cash to cover delayed payments from major retail networks, some of whom have delayed payments by as much as 120 days."