Saudi Arabia’s Almarai has announced plans to invest $500 million into its current projects in Egypt and is also exploring further food and agricultural acquisitions.
Almarai is among a group of Saudi companies that are reported to be looking to expand their agricultural operations in Egypt. Both the edible oil company, Saffola, and Jannat Agriculture Investment Co. are said to be investing EGP 5 Billion (US$655.2 million) to expand in their Egyptian agricultural and investment ventures according to Ahmed Darwish, director general of the Saudi-Egyptian Businessmen Association. In addition, in June 2014, Saudi company, Beyti, of which Almarai owns 52% and Pepsico owns the remaining 48%, announced its intentions to invest EGP 4 billion (US$524.1 million) into the building of two dairy farms in Egypt – the first with 5,000 head, and the second being the biggest in the country at 20,000 head, and the building of a new juice plant. The company’s board has granted approval to the first phase investment of EGP 2.5 billion (US$327.5 million), however the project is dependent upon the Egyptian government granting the necessary land for the project.
Since Almarai acquired Beyti with Pepsico in 2009, Beyti has allowed for a significant growth in operations, driving an increase in revenues of 38% per year since 2009. Since that time, Almarai has invested EGP 1.25 billion (US$163.7 million) into Egypt, gaining the company a 20% market share in the juice, dairy and yogurt segments – a number which the company aims to increase to 35% within five years.
Almarai is also reported to be exploring the acquisition of Dina Farms, as Qalaa Holdings has announced its intention of exiting its remaining food companies, milk producer, Dina Farms and Egyptian confectioner giant, Rashidi El-Mizan. Almarai is considering either HC or CI Capital to consult on the deal.
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