MHP (Myronivsky Hliboproduct), a leader in Ukraine’s agro-industrial sector, serves as a benchmark for other agricultural enterprises and demonstrates the potential of Ukraine as an investment target. Yuriy Kosiuk, CEO, says, “We are one of the companies responsible for Ukraine’s improving global image. We see ourselves as an educator and as a representative of Ukraine.” Having achieved outstanding growth, particularly over the past five years, MHP will soon become the biggest poultry producer in Europe when it opens its latest manufacturing facility in Ukraine in 2013.
MHP produces and sells high quality chicken products and is accounted for half of the chicken commercially produced in Ukraine in 2010 and nowadays. Covering the full value chain, MHP is also involved in grain production and processing as well as in the preparation of other food products, including sausages, cooked meat, premium fresh beef, foie gras and fruit. Operating on the principle “if you want something done well, do it yourself,” MHP runs a fleet of around 500 delivery trucks and offers its products through a network of franchised stores and supermarkets. Around 8% of total production is exported to CIS countries, the Middle East and Central Asia. Sooner or later MHP will be present in the EU.
Listed on London Stock Exchange
One measure of MHP’s success is that it is the first Ukrainian agro-industrial company to be listed on the main market of the London Stock Exchange. Yuriy Kosiuk points out, “We don’t see MHP as just a local player anymore, but rather an international player, with international standards. We try to educate the local community, for example concerning production of high quality meat and responsibility towards the environment. We want to show that if a company is honest and transparent, it can be very successful here in Ukraine.”
While MHP’s accomplishments are well known today, getting the company’s IPO off the ground proved difficult because of Ukraine’s negative international image, a problem the country is still facing. Yuriy Kosiuk says, “When we started our IPO process, potential investors, asked me upsetting questions like, ‘Where is Ukraine?’(laughing). They ranked Ukraine along with very low potential countries. So, we began to show people what the possibilities here really are. Through our transparency, openness and stellar results, we demonstrate that Ukraine is part of Europe and a good country to do business in.”
Fantastic investment opportunities
Forbes has nevertheless ranked Ukraine very low in the quality of its business environment, which Yuriy Logush, Vice President, believes is unjustified. He says, “I am the Vice Chairman of the American Chamber of Commerce in Ukraine, and I hear about companies’ problems in doing business here, but ratings are subjective and often set by people without much experience in the country. Investors here need to understand that they need to take the time to adapt and to understand Ukraine’s business environment, which is not at all like the American or European ones. In fact, Ukraine offers fantastic investment opportunities, not abstract ones but real ones. If companies have the right tools and drive, they can accomplish wonders here that would be impossible in Europe or America.”
In 1989, Ukraine was the world’s 13th biggest economy, but with the fall of the Soviet Union, it lost 70% of its GDP. Yuriy Logush explains, “Recovering from such a blow takes time, and Ukraine still needs to cover huge amounts of ground to catch up with EU countries, but the infrastructure is already here, and people here are highly educated and motivated. If investors are willing to take on the challenges, there is nothing to keep them from succeeding.”
What are the reasons behind MHP’s success story? Yuriy Kosiuk says, “MHP blends the best management techniques and the highest standards with a well educated staff and resources, so it has all the necessary ingredients for growth. The result is that today MHP is the leader in every segment in which it is present – poultry and crop production as well as meat processing, etc.”
Exceptional opportunity to partner with a winner
MHP will continue to grow along with Ukraine’s agriculture sector, which offers enormous potential as a major source of the world’s food in the coming decades. Yuriy Logush explains, “Ukraine has the richest possible soil, a long agricultural tradition and a history of innovation. All Ukraine needs is more investment and trust.”
MHP aims to expand internationally and anticipates success in the EU and other markets thanks to its high quality products, including meat produced without growth hormones, steroids and antibiotics. MHP has positioned itself as the ideal partner for European companies looking for opportunities in Ukraine. As Yuriy Logush puts it, “Europe is cutting agricultural subsidies but still needs to feed its people. MHP offers EU quality at one third the price, and we understand the European business culture. MHP is a reliable, transparent business partner, and we are looking for partners now. My advice to potential investors is, invest smart, invest in the right partner, and choose MHP. We have already proved that we can do it right.”