Private equity firm Horizon Capital’s USD200 million Emerging Europe Growth Fund III (EEGF III) has acquired a minority stake in Avrora, a specialist in the ‘dollar store’ retail segment in Ukraine, becoming the sole financial investor in the business alongside its founders.
Details of the transaction have not been disclosed.
The Company’s founders and management team will continue executing on their successful business strategy, retaining majority ownership and operating control of the Company. The Fund’s significant investment will accelerate the roll-out of new stores in Ukraine in the course of the next five years, expand logistics infrastructure, as well as finance Avrora’s entry into new regional markets. A portion of the invested capital will also help develop Avrora into a retail platform for small local manufacturers, thereby furthering import substitution and enhancing local manufacturing capabilities within Ukraine.
Headquartered in Poltava, Avrora is the leader in the Ukrainian dollar store market, operating circa 650 stores. The Company was founded in 2011 by Lev Zhydenko, Taras Panasenko, and Lesya Klimenko, who, together with their talented team, have set to revolutionize the retail industry in Ukraine and the region. Avrora prides itself on a progressive, flat culture, resulting in a high-performance environment with operating practices more similar to a tech company than a traditional retailer. The focus on operational excellence and obsession with delivering the best value to customers, have enabled Avrora’s rapid growth, expanding store-count by over 10 times in six years. Avrora’s focus on the discount segment allows its stores to be accessible to all Ukrainians irrespective of income, while at the same time makes their business recession proof, as demonstrated by their strong growth throughout economic cycles.
“We are delighted to back Avrora and help to further the bold vision set by Lev, Taras, and Lesya, who have built a truly admirable company over this past decade,” says Lenna Koszarny, Horizon Capital’s Founding Partner and CEO. “This investment was led from Horizon Capital by Vasile Tofan, Partner, who immediately recognised Avrora’s commitment to delivering excellence to their customers”.
Vasile Tofan, Partner, adds: “Avrora fits very well into our strategy of backing leading, regional high-growth champions. The Company’s management team have delivered an extraordinary growth trajectory, driven by a culture of operational excellence and their superb execution track record. Together with the founders and management, we will focus on positioning the Company for an IPO on a major exchange, capitalising on the appeal of the dollar store retail format around the world.”
Lev Zhydenko, Avrora’s Co-Founder says: “We are excited to attract such a reputable minority investor as Horizon Capital in order to fuel our continued growth trajectory. We look forward to leveraging Horizon Capital’s expertise, network and know-how to accelerate Avrora’s growth in Ukraine and expand our business in the broader CEE region. We are also committed to support local Ukrainian suppliers, increasing their share in our sales from 65 per cent today, thus making a strong contribution to the rebirth of small Ukrainian manufacturing and acting as a trailblazer for them in new export markets.”
