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Business news, 14.01.2004 15:23

Petmol to invest $15 million in Tetra Pak products

Tetra Pak filling station TBy summer 2004 St. Petersburg Dairy Factory ¹1 Petmol will have put into operation three new production lines using Tetra Pak packaging worth over $15 million.

The company is planning to completely modernize its production and to start the output of 15 new items by the end of the year. Petmol Company has contracted with Tetra Pak (Sweden) to deliver the latest equipment at the cost of $15.5 million. The new equipment will be payed for using a lease on a deferred term of 5 years with monthly pay-offs. According to the Director General of Petmol Company, Valentin Polyakov, the initial installment varies from 10 to 15% of the total contract value (percentage depends on specific machinery), with Petmol’s own and creditors’ funds being used in a 60:40 ration. The project’s payback time averages 3 or 4 years according to the production (dietary food stuffs, milk and infant food).

Besides the equipment delivered by Sweden, Petmol is about to install bottling equipment (France) for the new production. Valentin Polyakov says that Tetra Pak’s present contract with Petmol is the largest one Tetra Pak has an equipment supplier.

Valentin Polyakov also stated that there a provision has been made in the 2004 investment plan for the equipment upgrade. The Board of Directors adopted the plan in October 2003 to replace the old machinery with new machinery in compliance with European technology. The plan also includes mounting modern bottle filling lines and carrying out energy system reconstruction.

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