“Kormotech” invests over 60 million euros in the Kedainiai FEZ

The Ukrainian company specializing in pet food, “Kormotech,” unveils an ambitious plan to expand its manufacturing capabilities in the Kėdainiai Free Economic Zone (FEZ). The company aims to hire 200 specialists additionaly and invest over 60 million euros in four new production lines, scheduled to be operational by 2028.

“Kormotech” started its operations in 2020, opening a 4500 sq. m. factory in the Kėdainiai FEZ. Despite the initial plan to employ a team of 70 individuals, the company quickly exceeded expectations by hiring over 170 specialists. With this new expansion project, “Kormotech” plans to double its current workforce in Kėdainiai over the next five years.

Founded in Ukraine in 2003, “Kormotech” specializes in the production of wet and dry food for cats and dogs. The LEZ factory in Kėdainiai, equipped with high levels of automation and advanced machinery, currently produces 20,000 tons of the pet food annually.

The expansion plan of “Kormotech” envisions the launch of the first production line in the new factory in 2025, with one line added each year until all four lines are operational by 2028. The company will be searching for qualified engineers, food technologists, and other specialists to ensure the success of the project.

Including its headquarters in Lviv, the company currently employs more than 1,200 people globally. “Kormotech” is recognized as one of the top 50 employers in Ukraine and is known for its active participation in various social projects. The company promotes a humane approach to animals, supports the development of veterinary medicine in Ukraine, and provides assistance to animal shelters across the country.

Baltic Sea Properties will expand business park in Klaipėda FEZ

Publicly listed Baltic Sea Properties has recently entered into a land lease agreement with the Klaipėda Free Economic Zone (FEZ). This strategic partnership will facilitate the expansion of Klaipėda Business Park by up to 16,000 sqm in two phases over the coming years. The planned expansion will extend the 24,000 sqm integrated park complex’s total leasable area to over 40,000 sqm.

First established in 2003, Klaipėda Business Park (“Klaipėdos Verslo Parkas”) is the leading business park in Western Lithuania, with more than 30 companies leasing production, logistics, commercial, and office space in flexible units ranging from 50 to 8,000 sqm.

“We are happy to announce our expansion plans for Klaipėda Business Park, while also celebrating 20 years of cooperation with Klaipėda Free Economic Zone. Our strategy is to grow with our clients in a long-term partnership, and we look forward to providing additional high-quality serviced space for their business,” commented James Andrew Clarke, Chairman of The Board of Baltic Sea Properties.

The development of Klaipėda Business Park will be carried out in two stages. The company is currently starting to prepare the technical project of the facility. The company does not publicly state the size of the investment, but it will be one of the most significant recent development projects for customers of the Klaipėda FEZ.

According to Klaipėda FEZ manager Eimantas Kiudulas, Baltic Sea Properties has been offering its clients the opportunity to grow their business in one of the largest business communities in Western Lithuania for the third decade.

“We are happy about this 20-year-long strategic partnership with Klaipėda Business Park, which has led to 3 completed development stages and is starting two new ones today. Klaipėda Business Park successfully complements the strategies of flexibility, rapid establishment and development of Klaipėda FEZ, and the implemented development project will offer even more quality diversity to existing and new investors”, says E. Kiudulas.

Baltic Sea Properties, the owner and manager of Klaipėda Business Park, is listed on the Oslo Stock Exchange and is a major real estate developer and investor in the Baltic region.

Klaipėda FEZ receives international awards for non-fiscal incentives and green energy

Klaipėda Free Economic Zone (FEZ) has received an Excellence award for non-fiscal incentives for investors and an Honourable mention for renewable energy solutions in the annual rankings of FDI Intelligence, a publication of the Financial Times group.

In this year’s FDI Intelligence’s Free Zones of the Year rankings, non-fiscal incentives were given special attention. The publication estimates that, although final decisions have not yet been taken, the OECD’s proposed global minimum corporate tax may soon deprive free zones of the crucial argument for lower taxes. 

Therefore, when awarding the prize, FDI Intelligence evaluated the non-fiscal measures of the Klaipėda FEZ in recent years – the quick launch strategy, an active and cooperative business community, established relationships with key local and national partners, talent development, infrastructure development and other advantages that determine investors’ willingness to set up and expand. FDI Intelligene also pointed to recent surveys conducted by the Klaipėda FEZ and its partners, according to which 80% of the city’s residents have a positive opinion of the reputation of the FEZ, and as many as 9 out of 10 existing investors would recommend their experience in the Klaipėda free zone.

According to Eimantas Kiudulas, the CEO of Klaipėda FEZ Manager, this year’s focus on non-tax benefits illustrates a marked change in investor thinking and behaviour.

“The award from FDI Intelligence is clearly encouraging, but it is also a reminder that businesses, especially those that Lithuania wants the most, are becoming less and less interested in costs – taxes or labour. The most common questions we hear from stakeholders are about the quantity and quality of talent, the fluidity of processes, community and infrastructure. Some of these issues we can address ourselves, but local and national government can also play a role – Klaipėda, for example, is one of the few Lithuanian cities with a green corridor for larger investors. However, having already lost its status as a cheap labour country and the argument of tax incentives disappearing, Lithuania simply has to pay maximum attention to developing, attracting and retaining talent,” comments E. Kiudulas.

In this year’s FDI Intelligence’s rankings, Klaipėda FEZ also received an honourable mention for its green energy solutions – solar power plants on company roofs and even fences, and other energy independence measures that have been in place for many years. Last year alone, the total installed capacity of solar power plants in the Klaipėda FEZ doubled to 4MW, and most of the development decisions were taken before the electricity price crisis hit last year. Also, the majority of Klaipėda FEZ companies are buying green electricity from the grid and investing in a variety of other energy efficiency or generation solutions.

In the past, the Klaipėda FEZ has won main and special awards in FDI Intelligence rankings in areas such as quick launch, sustainability, new technologies or investor expansions.

Last year, more than 45 Lithuanian and foreign investors operating in the Klaipėda FEZ achieved a total turnover of EUR 1.76 billion and exports of EUR 780 million. Purchases of goods and services by Klaipėda FEZ investors in Lithuania in 2022 exceeded EUR 500 million, and VAT, GPM and social taxes paid last year reached EUR 107.3 million. In comparison, state aid granted to Klaipėda FEZ investors in 2022 amounted to only EUR 8.2 million.

Dancer buses introduced at Busworld in Brussels

Vėjo Projektai, a company developing fully electric Dancer buses in the Klaipėda FEZ, introduced itself to the world last week at Busworld 2023 in Brussels – one of the most important passenger transport events attended by tens of thousands of people.

According to the company, visitors were most impressed by the exceptional design, lightness and cutting-edge technologies of the Lithuanian bus. The company hints that in the future, the Klaipėda-made bus will be seen not only on the streets of its hometown, but also in other European cities.

“We hope that the Dancer buses will soon be seen not only in Lithuania – two of our models and the e-mobility solutions offered with them have been of interest at the exhibition by passenger carriers from the Nordic countries, Germany, France, the Netherlands, Belgium and other European countries,” says Alvydas Naujėkas, the CEO of Dancer.

Busworld 2023 is one of the most important events in passenger transport, revealing the future of the sector. It is a good opportunity to meet industry leaders, potential partners and customers.

Visitors the Dancer bus stand could learn all about the two technologically advanced, 100% electric Dancer bus models – the fast-charging Dancer (FC 75) and the long-range Dancer (LR 530). The low-floor electric buses produced and operated in Lithuania have already saved almost half a million tonnes of CO2 emissions.

The fast-charging Dancer (FC 75), designed for dynamic cities, has an extremely fast charging time of just 8 minutes. The bus is also extremely economical, with an average energy consumption of 0.72 kWh/km, allowing it to cover up to 100 km on a single charge. These technical features, together with fast charging, make it easy to operate in urban areas.

US biotechnology company invests at Klaipėda FEZ FlexStart facility

American capital biotechnology company Cureline Inc. is investing EUR 3.5 million in the construction of a new biotechnology plant and research laboratory in Klaipėda FEZ. The plant, laboratory and administrative premises will be located in the FlexStart facility. The start of operations is planned for the first half of 2024.

The new plant and laboratory will be managed by Memel Biotech, a subsidiary of Cureline Inc. group, VZ.LT reports.

Its CEO Agnė Vaitkevičienė says that the company will be involved in the production of medical products, including advanced therapy drugs for clinical trials, with direct customers being pharmaceutical companies and medical institutions worldwide.

“We will be the first in Lithuania to be able to develop this level of products for clinical trials. We will also be one of the few in the Baltic States and Poland. This market is not yet widely occupied in the region, but the global demand for such products is huge, so not only we as a company, but also Lithuania as a country has the potential to become a centre of advanced therapeutic technologies,” the company’s announcement quotes A. Vaitkevičienė, CEO of Memel Biotech, as saying.

According to her, Memel Biotech will be equipped with special premises complying with the standards for the production of sterile medical products, where innovative biotechnological products for personalised medicine will be developed and manufactured.

The estimated floor area of the plant with commercial premises is 850 sqm. The company intends to recruit up to 25 highly qualified professionals over the next two years. Until now, Cureline Baltic has had an administrative office and an animal laboratory in Vilnius.

Factory making sustainable construction components opens its doors at Akmenė FEZ

A sustainable construction components factory began operations this week at Akmenė FEZ. What makes these sustainable wooden components special, and what are they used for, what makes this factory different from any other, how will it contribute to sustainable growth, and why is this a significant event for Lithuania?

Sustainable wood products for construction, or engineered structural wood, includes laminated veneer lumber, used for strong, compression-resistant joists, columns, facades, and other industrialised construction and renovation elements. Such lumber can replace highly-polluting materials used in the construction industry, such as cement, concrete, and reinforced concrete. More than 30 per cent of new buildings in Western Europe and Scandinavia are built using such sustainable, environmentally-friendly components.

The sustainable construction components factory that has begun to operate at the Akmenė FEZ is the first such factory in Lithuania and the third in Europe. Until now, there were only two such factories; both of them are in Norway. The owners of the factory at Akmenė FEZ is the global investment company VMG Group. The factory was built by AB Hanner and the UAB BRAITIN-owned fund Baltic Industrial Fund II. These companies’ extensive experience in their respective fields (industry, construction, and finance) created synergies and allowed them to efficiently implement the project, the value of which is €10 million.

The factory will start by producing laminated veneer lumber, two-ply joists, and construction chipboard, and later the product assortment will expand. The factory’s annual production capacity is 120,000 m3 of laminated veneer lumber, 15 million metres of two-ply joists, and 200,000 m3 of construction chipboard. Turnover is estimated to be up to €150 million. The factory will create 200 jobs.

Products made at the factory will supply the market in Western Europe, Scandinavia, and Lithuania. One of the advantages of engineered structural wood is the ease with which it can be transported, so export is planned to North America and Australia. Until recently, Australia imported such wood from Russia, but due to the changing political environment, agreements have been signed with producers in Lithuania. At present, negotiations are proceeding regarding export to the USA; there, production of structural lumber is concentrated on the West Coast, so for companies located on the East Coast it is cheaper to import such wood from Europe.

The new factory will contribute to environmentally-friendly construction in various ways, by supplying to the market natural, less-polluting products and by producing in an environmentally-friendly way. It is expected that the sustainable construction components made here will gradually replace the polluting materials in use until now, such as cement, concrete, and reinforced concrete.

Glassbel to partner Halio, a US smart glass innovator

Glassbel Baltic, an architectural glass manufacturer operating in the Klaipėda Free Economic Zone (FEZ), has entered into a strategic partnership with Halio, a designer of the world’s fastest, most beautiful, eco-friendly, and technologically advanced architectural smart glass. This cooperation will allow the Klaipėda-based company to implement Halio’s solutions with light transmittance management systems in its products and distribute them in Europe, Middle East and other markets.

As part of the worldwide challenge of energy efficiency and sustainability in modern architecture, Glassbel, which exports to 30 countries on 4 continents, will now be able to offer smart glass facade solutions using Halio’s intelligent technology. The smart solution consists of glass products with an integrated Halio device that reacts to the changing environment, so that the glass darkens or lightens accordingly in real time, thus reducing air conditioning or heating costs. The American technology, which consists of a sophisticated combination of sensors, switches, chemicals, hardware, software and artificial intelligence, not only ensures human comfort but also makes buildings more energy efficient.

According to Valdas Virbalas, CCO at Glassbel Baltic, the agreement with the American company will allow Glassbel to strengthen its portfolio of innovative products.

“Such smart glass solutions are still a novelty around the world, which the market will have to accept, learn to work with and invest in. But sustainability and energy efficiency have been the dominant themes in new buildings for some time now, so we are delighted to add a relevant innovation to our portfolio and further strengthen our position in the market for innovative architectural glass. We are currently completing our first small real project with Halio technology and exporting it to Silicon Valley in the USA, where the business community is currently the most interested and involved in smart technologies,” comments Virbalas.

According to Bruce Sohn, CEO of Halio, Glassbel’s quality, expertise and wide geography of markets make this partnership highly valuable for both sides.

“This collaboration allows us to market groundbreaking technology to our customers in Europe and the Middle East. We’re proud to jointly offer the fastest, most eco-friendly, energy-efficient solution, and the utmost beautiful and highest-performing smart glass available in the market” says Sohn.

And according to Dmitri Sobolevski, CEO of Glassbel, Halio’s solution is the best on the market for speed, facade integrity and aesthetics.

“We are delighted to partner with the world leaders in smart glass technology. The Halio solution is revolutionary, significantly faster to react to changing environments, aesthetically neutral and durable, and technologically more robust than any alternative,” says Mr Sobolevski.

Eimantas Kiudulas, the CEO of Klaipėda FEZ, also welcomes this partnership, pointing out that Glassbel will be both more sustainable and more competitive with the US company’s technology.

“We are pleased that with this step Glassbel is strengthening several strategic areas of Klaipėda FEZ at once – high value-added manufacturing, application of new technologies, as well as environmental protection and sustainability,” commented E. Kiudulas.

Halio was founded in 2010 in California, USA. The company markets its solutions both on its own and through partners including Glassbel. Halio has raised more than 300 million USD throughout its history, including from SK Holdings, US sustainable investment fund Capricorn Investment Group and other investors.

Glassbel’s revenue last year was 22 million euros, a quarter more than in 2021. The company currently employs around 180 colleagues in Klaipėda.

Glassbel has been operating in the Klaipėda FEZ since 2009. The company exports more than 90% of its production, mainly to Ireland, the UK, the US, Western Europe, Saudi Arabia, Scandinavia and other markets.

A++ building for investors at the Baltic FEZ

UAB “MLEZ Infrastruktūra”, which is a 100% owned subsidiary of UAB “Marijampolės LEZ valdymo bendrovė” (MLEZ), and UAB “Viešųjų investicijų plėtros agentūra” (VIPA) (Public Investment Development Agency) have signed a contract for the design and construction of a approx. 5440 m2 manufacturing building and the necessary infrastructure for it in the Marijampolė Free Economic Zone (Baltic FEZ). The project, which is being partially financed with the VIPA loan from the national budget of the Republic of Lithuania, is planned to be completed by the end of 2024.

“The macroeconomic indicators for the manufacturing industry do not inspire much optimism, and the situation is likely to worsen for some time throughout Europe, which will lead to a higher cost of money. Together with the Board, having carefully analysed market trends, we have decided that this is an excellent opportunity to lock in the price for borrowed money, to define the conditions for this loan with the lender and at the most difficult economic moment to reach favorable negotiating results with the contractors, with whom we plan to conduct detailed negotiations at the end of this year. Our objective, having locked in the prices for construction and contract works, is next year to build the manufacturing and warehousing areas under especially competitive conditions,” says Simonas Petrulis, CEO of MLEZ, presenting the plans for the near future.

We will offer this building to investors at the beginning of 2025. A distinct advantage is the fact that the building will be right next to the Via Baltica, the node for Rail Baltica 1 and Rail Baltica 2, and the Lithuanian-Polish border, where the FEZ will offer tax incentives and the most modern industrial infrastructure in the Baltic countries. In the adjacent city of Marijampolė, there are a wide variety of potential partners: the Vocational Training Centre, college, and strong companies operating in the food, wood, and metalworking industries. Take the right decision – together with MLEZ, plan the next stage of expansion for your business. Together with us, current and future clients gain a huge competitive advantage and accelerate the growth of their business.

Klaipėda FEZ investors’ taxes paid exceeded EUR 100 million

Last year, the total taxes paid by more than 40 investors operating in the Klaipėda Free Economic Zone (FEZ) amounted to EUR 107.3 million and reached an all-time record. Purchases of goods and services by FEZ companies in Lithuania also reached an all-time high of more than EUR 500 million.

Last year’s war, as well as the energy, raw materials and inflation crises, and the signs of recession that started to emerge in the second half of the year, distorted the main indicators of Klaipėda FEZ investors. Although the total turnover of companies amounting to EUR 1.76 billion and exports of EUR 780 million are also all-time records, they were significantly affected by the sharp increase in raw material prices related to the pricing of several major investors’ products. Leaving these companies aside, the rest of the Klaipėda FEZ business community has shown moderate growth throughout the past year, but many businesses have faced deteriorating consumer sentiment in the second half of the year.

However, other Klaipėda FEZ business community results continue to show a strong and growing contribution to the regional and national economy. Last year, purchases of goods and services by FEZ investors in Lithuania amounted to EUR 505 million, or 84% more than in 2021. Around one third of this figure is accounted for by the biodiesel producer UAB Mestilla, which buys rapeseed and other raw materials from Lithuanian farmers.

The amount of taxes paid by the Klaipėda FEZ business community also reached an all-time high last year – EUR 107.3 million in social, revenue and VAT taxes were 42% more than in 2021. In comparison, over the past year, the FEZ investors received EUR 8.2 million of state aid, which in the form of taxes alone has paid back several times over.

Last year, existing and new investors in Klaipėda FEZ implemented investment projects worth EUR 45.8 million. The largest investments were made in new REHAU and Finegri factories, while Retal Baltic Films, Neo Group, Orion Global PET, Pack Klaipėda, Lavango Engineering, Glassbel Baltic, Mestilla and other companies invested in the expansion of their existing capacities and infrastructure.

The number of jobs in Klaipėda FEZ investors’ companies increased from 2,300 to 2,800 last year, while the number of employees in the whole FEZ territory was around 5,000 last year.

According to Eimantas Kiudulas, the Klaipėda FEZ CEO, companies in the territory not only demonstrated resilience in a difficult period, but also increased their contribution to the national economy. 

“It is still difficult to talk about large new investments, and the beginning of this year is not easy for business, but we are actively preparing for the expected recovery. A business community that is stable throughout all economic cycles will be one of the factors that will allow us to gain momentum as markets recover,” comments Mr Kiudulas.

Since the inception of Klaipėda FEZ in 2002, Lithuanian and foreign capital companies have invested or plan to invest EUR 778 million in the territory. Since 2011, Klaipėda FEZ investors have paid a total of EUR 591 million in taxes, while the state aid received during this period amounted to EUR 61.3 million.

Dovista, UAB enters a new phase of expansion

Dovista started operating in the Baltic FEZ 5 years ago. Today the company enters a new phase.  The construction and installations works have already begun in the Production unit.  Windows of non – standart shapes and sliding doors will be produced here. From now until the end of 2023 more than 100 employees are planned to be employed in the company. 

© LAFEZ visos teisės saugomos 2021