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EBRD, EU and Switzerland help transform Ukraine yeast producer


When siblings Olena and Rostyslav Vovk are asked how their family business began, the answer is pretty simple. “During Soviet times, our father was one of the senior managers at the alcohol and yeast corporation,” they explain. “In the 1990s he saw the potential of one of the most under-developed regional yeast plants, and so he created his own company – Enzym.”   

As soon as the borders opened in the early 1990s, he went to Europe, learned about European standards on hygiene, efficiency and equipment, and used them as a benchmark.  

“The company ceased being Soviet and by the early 2000s we were essentially European,” Olena says.  

Enzym is now the market leader in the yeast industry in Ukraine and one of the largest and most modern producers in Europe, having developed such business areas as a bakery, yeast production, yeast food ingredients and feed additives.  

Olena heads Enzym Group and Rostyslav manages Kormotech, a pet food producer. Both are part of the Vovk family business, based in Lviv.   

Challenges can be opportunities  

The siblings had their own plans for life and a career. Olena, for example, dreamt of a career in international diplomacy or finance. “When I returned to Kyiv, after studying in the United States, our father suggested that I join a few strategic meetings and I completely fell for it,” Olena recalls.   

“I came to father with my own business idea and never looked back,” Rostyslav explains. “I started to construct a new plant and was so fascinated that it became my life.”    

The siblings are constantly looking for new opportunities, which sometimes emerge from challenges. With fewer people eating bread, production facilities becoming more efficient and yeast becoming more active and less product being required, the global bread market is stagnating. So the company decided to diversify into science-intensive yeast food ingredients.  

“The first thing to invest in is research and development. An advisory project with the EBRD helped us involve scientific experts from various countries, who formed the basis of our R&D department, which currently counts more than 20 scientists. This became the heart of our transformation, because their task is to work on new products based on the yeast cell, which we can then commercialise,” shares Olena.    

The project was supported by the EBRD Ukraine Stabilisation and Sustainable Growth Multi-Donor Account (which comprises Denmark, Finland, France, Germany, Italy, Japan, the Netherlands, Norway, Poland, Sweden, Switzerland, the United Kingdom, the United States of America and the European Union, the largest donor).  

Enzym Group has also become one of the winners of Climate Innovation Vouchers, a joint initiative by the EBRD and the European Union. This helped the company increase the capacity of biogas reactor and deepen the cleaning process of wastewater in the yeast production process. Depending on the season, it now recovers between 30 and 50 per cent of its natural gas needs with biogas from its plants.  

Furthermore, the EBRD’s international advisory programme helped the company assess the need for a new plant. In December 2020 during the Covid-19 pandemic, Enzym Group received a €10 million loan from the Bank to expand production. It was co-financed by a €3 million loan from the TaiwanICDF. In addition, the European Union, under its EU4Business initiative, covered environmental and social due diligence and legal costs.    

The new plant makes products that contain more than 45-50 per cent protein, allowing the food industry to use alternatives to salt, help vegans and vegetarians increase their protein intake and improve the flavour of the final product. Their probiotic yeast makes it possible to substitute or reduce the use of antibiotics in animal husbandry, addressing the global problem of antibiotic resistance.   

The factory is one of few such factories in the world. It was finished during the full-scale war.   

Disbelieving but prepared  

“No one believed the war would happen, but we were preparing for it. Bomb shelters for all employees were ready and equipped. We had several drills, all employees knew what to do. We had bought all the necessary raw materials and gas. On 24 February in the morning, 99 per cent of our workers were at their workplaces. It says a lot about their commitment. We did not stop working, even for a day,” Olena says.  

“We realised that bread would become a basic need, as well as yeast – bakeries and bread factories could not work, so people baked at home,” she remembers. “On the first day of war, we split into a crisis and humanitarian centre. The crisis centre helped provide yeast to all regions despite disruptions in the supply chain. Our humanitarian centre received requests from volunteers to whom we sent yeast for free. Some employees also baked bread until night for refugees at Lviv railway station.”  

Unstoppable  

Despite the war, Enzym Group continued to receive inquiries from potential partners arund the world. “Our office and warehouse in Krakow, Poland, help us reduce the risks for our global partners. It means we can provide them with a product of high quality on time, regardless of circumstances,” Olena shares. 

“Currently, we are present in Europen markets, the UK, Asia and Africa and, in the near future, we plan to expand there further. We have also recently launched a new factory. The potential of yeast ingredients is huge.” 

Enzym Group already exports more than half its products to 23 countries and will celebrate its 30th anniversary next year.   

The company is also working on further advisory projects to increase operations management efficiency and improve the micro-organism fermentation process. Both projects are being implemented with EBRD support and funding from Switzerland through the EBRD’s Small Business Impact Fund (donors to the SBIF are: Italy, Ireland, South Korea, Luxembourg, Norway, Switzerland, Sweden, Japan, the United States, and the TaiwanBusiness-EBRD Technical Cooperation Fund).   

“The success of our company is based on the ambition that we never stop and we are always a step ahead,” concludes Olena. “That has made it possible to achieve the dream of our father – to build a modern and successful European company.”   

Source: EBRD

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