Linen of Desna to invest $25 m in flax production in Zhytomyr region, says regional authorities
Kyiv, September 7 (Interfax-Ukraine) – Zhytomyr Regional State Administration plans to sign a memorandum on cooperation with Novhorod-Siversky-based Linen of Desna LLC in Chernihiv region under a $25 million project for the reconstruction of the Volodarsko-Volynsky flax processing plant and the restarting of production at it.
The memorandum is to be signed in Kyiv on September 14, 2011 during the presentation entitled Zhytomyrschyna Investytsiyna [Zhytomyr Region for Investment], Serhiy Ryzhuk, the head of Zhytomyr Regional Administration, said at a press conference at Interfax-Ukraine on Tuesday.
"This year we've allocated 10 times more funds for the development of agriculture, including flax production, and plan to sow 5,000 hectares rather than 500 hectares with flax," he said.
Linen of Desna LLC was founded in 2009 and is headed by Michel Tereshchenko, a descendant of a well-known founder of Ukrainian sugar refineries in the 19th century. Its core business is the cultivation of flax, and the production of flax fiber and packthread.
The company owns three plants, two of which are located in Sumy region (the village of Sobycheve in Shostka district and the village of Marchykhyna-Buda in Yampil district) and are presently in operation, and the third in Chernihiv region (the town of Novhorod-Siversky) is under reconstruction.
After the acquisition of new facilities and the renovation of the existing ones, Linen of Desna plans to expand the area under flax crops from 700 to 15,000 hectares.
The company's net revenues in 2010 were UAH 2.09 million, and it made a net loss of UAH 1.12 million.