The transaction will likely close in the second half of 2023 and is subject to regulatory approvals in Estonia and Latvia.

"The sale of the Baltic business will improve HKScan's profitability and strengthen its balance sheet," said HKScan's interim CEO Juha Ruohola.

He said it will "enhance" the company's "operational efficiency" and allow it to carry out its long-term strategy of growing into a versatile food company.

HKScan's Baltic production units are located in Rakvere, Tabasalu and Viiratsi in Estonia and Jelgava in Latvia. The company's consumer brands in the Baltics are Rakvere, Tallegg, Rigas Miesnieks, Jelgava and Klaipedos Maistas.

AS Maag Grupp has operated in the meat and dairy business for over 25 years. It employs around 1,000 people in Estonia, Poland and Finland. Its best-known brands are Tere, Farmi, Deary, Rannarootsi, Rannamõisa and Pouttu.

Roland Lepp, Chairman of the Supervisory Board of AS Maag Grupp, said the acquisition will help Maag strengthen its market position.

"This will also provide us all better food security in turbulent times," he added.

The debt-free purchase price is €90 million, of which €20 million is conditional on the combined performance of the separately defined meat business subject to the transaction and Maag Grupp's Baltic meat business in the following years.

Of the €70 million fixed purchase price, €55 million will be paid at the closing of the transaction and the remainder over the next three years.

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