Saudi Company Acquires Bankrupt Estonian Dairy Plant E-Piim

Saudi Arabian company Bindawood has purchased the production facility of the bankrupt dairy company E-Piim in Paide for €135 million, well above the auction's starting price of €80 million. The plant is capable of processing nearly 40% of all milk produced in Estonia.

Along with the facility, the new owner has also taken on a €30 million debt owed to farmers by the previous company.

Plans to stabilize operations

BinDawood holding CEO Ahmad Bindawood said the first priority is to stabilize the plant's operations after two difficult years, and to ensure its full production capacity is put to use. The plant currently processes around 1,100–1,200 tonnes of milk per day, and the company aims to reach that capacity as soon as possible.

Local investors also took part in the auction but concluded that the risks were too high to justify offering such a large sum. Investor Joakim Helenius expressed surprise that the buyer came from the Middle East, adding that this could open opportunities for Estonian dairy products to be exported to the region in the future — news he said would be very welcome for Estonian milk producers.

Focus on rebuilding trust

The new owner intends to first strengthen its position on the Estonian domestic market before expanding into the wider European market. Estonia's Minister of Regional Affairs and Agriculture, Hendrik Johannes Terras, said that after meeting with representatives of the new owner, he understood how important it was for them to restore trust that had been damaged by the plant's difficult history. He noted the new owner's goal is to ensure stability in Estonia's primary dairy production, including fair prices and timely payments to milk producers.

Helenius also noted that preparatory work revealed the plant requires further investment, with the purchase of protein production equipment expected to be the most costly item.