Kernel to acquire a Ukrainian enterprise with a leased land area of 2.5 ths ha

Kernel Group (KER PW: N/R) signed a preliminary agreement to acquire an undisclosed enterprise, which leases 2.5 ths ha in the central part of Ukraine. The volume of the deal is said to be USD 3.2 mln. The deal is expected to close by the end of June. Anna Dudchenko: This acquisition is in line with Kernel’s strategy to expand its land bank to 250 ths ha by 2010 (the company currently leases 60 ths ha). Details of the deal have not been disclosed yet, however, we estimate that Kernel will acquire an enterprise with machinery & infrastructure, as the price indicated puts the value at USD ~1,280 per ha vs. USD 100-200 per ha usually paid by Ukrainian agricultural companies for farms without any significant machinery & infrastructure.