Letter of Intent on exclusive supply of cooking oils

We would like to inform all interested parties that a letter of intent has been signed with a Polish company based in Brodnica, specializing in the production, filling, packaging and sale of rapeseed and sunflower oil. As part of this agreement, the two companies are considering finalizing a long-term agreement that would make MBF Group SA the exclusive supplier of rapeseed and sunflower oil to the said company.

The contractor with whom the aforementioned Letter was signed has ready infrastructure for filling, packaging and labeling rapeseed and cooking oil in 1-, 3- and 5-liter bottles. The contractor has a modern production line that ensures the high quality of its products. It is currently in the process of implementing a Quality Management System standard – the HCCP system to ensure good manufacturing and hygiene practices.

We are currently negotiating and considering the possibility of finalizing a full contract that will make us the sole supplier of raw materials – refined rapeseed oil and refined sunflower oil – to this company. Below are the main advantages and prospects of this cooperation, as well as potential risks.

The cooperation between MBF Group SA and the aforementioned company carries a number of significant advantages and prospects:

  1. Exclusive market position: Finalizing the agreement will allow MBF Group SA to gain a unique position in the market as the sole supplier of rapeseed and sunflower oil to this renowned company. This unique position can enhance a company’s image and increase its visibility in the market.
  2. Stable source of revenue: The production and supply process of rapeseed oil and sunflower oil is complex, suggesting long-term cooperation and a stable source of revenue for MBF Group SA.
  3. Potential for product portfolio development: The collaboration opens the door to expanding product offerings, including related products and storage and distribution services. This can contribute to the company’s revenue.
  4. Increase in turnover: The finalization of the agreement will help increase MBF Group SA’s turnover, which will translate into revenue growth in the long term. As an exclusive oil supplier, the company can expect steady and reliable revenues.
  5. Growth and expansion: Working with a reputable partner opens up new prospects for growth and expansion in the market. This can attract the attention of other customers and potential partners, which will affect the further development of the company.
  6. Synergy and optimization: long-term cooperation will enable both companies to jointly optimize costs and processes, which will contribute to increased competitiveness and operational efficiency.

In summary – signing a contract with a company specializing in rapeseed and sunflower oil offers the possibility of numerous benefits, including a unique market position, a stable source of revenue, increased turnover and the opportunity for growth. This is a step that has the potential to significantly affect the future of MBF Group SA, creating new opportunities and strengthening our position in the market.

At the same time, the Company’s Management Board notes that as the process of production and supply of rapeseed oil and sunflower oil is complex, this may suggest long-term cooperation and a stable source of revenue for the Issuer. The cooperation will enable the two companies to jointly optimize costs and processes, which will contribute to increased competitiveness and operational efficiency.



Potential threats and risks:

  1. Dependence on a single customer: In the event that MBF Group SA became the sole supplier of oil to the said company, the company would be at greater risk if this cooperation were to be discontinued.
  2. Contract negotiations: The process of negotiating and finalizing a contract can be complicated, and both parties need to carefully define the terms of cooperation and ensure that their interests are safeguarded.
  3. Market risk: The rapeseed and sunflower oil market is susceptible to changes in raw material prices and demand on the world market, which may affect the stability and profitability of the cooperation.

MBF Group SA is aware of these issues and will seek to minimize risks through careful planning and management of the relationship with the partner. Nevertheless, it is important to remember that no cooperation is risk-free, and both parties should carefully consider and discuss all aspects of the cooperation before finalizing the contract.

Regardless of the final outcome of the talks and negotiations, the Issuer will report on the outcome in a Current ESPI Report. In the case of a positive decision, according to the Contractor’s declarations, cooperation and trade will begin, without undue delay, but not earlier than January 2024.