KEN is a meat processing facility in rural Bulgaria, producing fresh meat cuts of beef and pork. Founded in 1991, KEN specializes in boiled-smoked sausages, including its leading product: the KEN frankfurter.
Shortly after its inception, the meat processing company approached SEAF when KEN’s entrepreneurs realized they needed long-term capital to finance the construction of a formal sausage manufacturing facility . The new facility also required the purchase of land and additional processing equipment.
In 1995, SEAF purchased company shares and provided a loan to the company through CARESBAC Bulgaria. In 1996, KEN experienced unforeseen difficulties when Bulgaria entered into a period of severe political crisis and economic decline. Bulgaria’s GDP plummeted almost 10% in 1996 alone. The agriculture and food processing sectors suffered greatly from the resulting uncertainties, and the meat processing industry was particularly hard hit. However, SEAF maintained its partnership with KEN, and in addition to financial support, provided the company with extensive business assistance on its marketing and distribution systems. SEAF arranged an onsite visit from a Canadian marketing consultant and recruited a German meat processing and machinery expert to consult KEN on more efficient production practices, high-performance machinery, and improved material and inventory controls.
Although the volatile environment forced KEN to postpone construction of its new processing plant, the plant was finally completed in June 2000. Following SEAF’s infusion of capital and provision of technical assistance, KEN grew rapidly. Over the life of the investment, the company expanded its capacity tenfold and increased employment from 16 to 125 people. At the time of SEAF’s exit, Ken’s average monthly wage more than doubled and was nearly three times higher than the national average.
In a case study conducted by SEAF in 2003, SEAF gathered employee insight and interviewed an employee named Sofia* In 1999, Sofia was offered an entry level factory job at Ken as a common laborer. Four years later, she became a shift supervisor of a team of 15 sausage production workers and Ken provided her with on-the-job training in meat processing technology, food safety, and hygiene. She then was able to train other employees in these areas and in other industry standards. Because of Ken, she is able to support herself and her mother who lives with her. Sofia said that beyond employment security, good pay, and social benefits; “Ken gave me a community of people who cared for each other, a positive philosophy for life, and self-esteem.”
A Completed Exit
In March of 2001, SEAF exited from its investment in KEN, selling its shares and debt to the management. Despite the volatile economic environment in the late 1990’s, KEN, through its partnership with SEAF, emerged as a successful and dynamic private meat processing plant.
*Employee’s name has been changed