Still not efficient or financially strong enough to attempt westbound expansion, many Romanian companies have shifted focus to the Balkans in the last 12 months. Whereas plans for expansion to Serbia, Bulgaria or Croatia have never left the blueprint stages in many cases, there are companies that dared do it.
One of them is La Fantana, or its shareholders to be precise, i.e. Romanian businessman Cristian Amza and Swedish investment fund Oresa Ventures that decided to invest about $4 million in starting a water cooler system delivery company in Serbia.
The company will be called La Fontana and will operate in line with the same principles that turned its Romanian peer into the leader of its market, with $9 million turnover in 2003.
"We decided to invest in Serbia because this is the only water cooler market in Europe that meets two essential conditions for a successful entrepreneurial start-up: it does not have a player that prevails on the market or world class strategic investors (Danone, Coca-Cola, Nestle i.e.) present. Furthermore, the number of water coolers on the market is estimated to 3,000, compared with 15,000 in Croatia, 20,000 in Romania or even 300,000 in Poland. The potential is very high therefore," Cornel Marian, Oresa Ventures fund representative told Ziarul Financiar.
The fund owns about 85% in La Fantana at the moment, with the rest of the shares held by Cristian Amza, the founder and general manager of the company.
La Fantana came to account for approximately 75% of the domestic water cooler market following some $10 million investments in the production and bottling facility, in its sales force, its distribution fleet and in advertising. The financing came from shareholders (about $4.5 million), banking loans and leasing.
"We will theoretically apply the same formula in Serbia. Even though the potential is high, we want to grow in small but steady steps. We estimate we'll have installed 10,000 water coolers in the next three or four years, which would take the turnover to $5-$6 million a year," Marian specified.
La Fontana will begin supplying water coolers in April this year. The general manager will be Romanian, and the rest of the employees (several dozen people in the first year) will be Serbs.
The company will also establish a joint venture with a Serbian mineral water company to handle production and bottling.
Oresa Ventures has invested in the two companies in Romania and Serbia in order to turn them into market leaders in both countries and sell them to a strategic investor (like Coca-Cola, Nestle or Danone), interested to expand in the region.
laurentiu.ispir@zf.ro
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