The deal was announced on Wednesday and will see Falber Investments OÜ, the parent company of Agrone, Estonia's largest agricultural group and the region's largest independent raw milk producer, buy the group of AS Rīgas piena kombināts, Latvia's largest dairy processing company.

The parties have agreed not to disclose the cost of the sale.

"We see significant potential in the two companies' complementary knowledge and experience," said Raul Jeets, chairman of Agrone's management board.

"We have consistently developed Agrone, with a focus on innovative agriculture, a leading environmental footprint, animal welfare and the production of high-quality raw milk, while Rīgas piena kombināts is highly capable in dairy processing, product innovation, brand development and consumer engagement," he added.

The statement said the companies will continue to operate as "separate and independent" businesses until the transaction is completed.

Signing the agreement will not result in any immediate changes to the day-to-day operations of Rīgas piena kombināts, it added.

"The companies will continue production and cooperation with employees, customers, milk suppliers and other partners as before. The companies will communicate next steps separately once the required regulatory approvals have been obtained," the statement said.

Agrone is the largest independent raw milk producer in Estonia and one of the leading raw milk producers in the Baltics and Northern Europe.

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