March 7, 2024

By Lynda Kiernan-Stone, Global AgInvesting Media

Leading food, feed, and fiber agribusiness Olam Agri has completed the acquisition of Avisen SARL (Avisen), the second largest poultry feed supplier in Senegal, for US$24.8 million, through a deal funded by a combination of existing cash and debt facilities. 

Olam Agri was one of the operating groups formed by Olam in 2020 following an announced reorganization undertaken to unlock long-term value. Operating under its mission to “transform food, feed, and fiber for a more sustainable future”, Olam Agri targets high-growth consumption markets leveraging its global origination capabilities, trading and marketing footprint, best-in-class logistics, and risk management expertise. 

Olam explained that this acquisition of Avisen aligns with its strategy to strengthen its animal feed and protein capabilities by investing in proven businesses with strong market positions. It also strengthens its feed and protein presence in West Africa where it is one of the leading animal feed and day-old chick producers in Nigeria, and will provide synergies with its wheat milling business in Senegal, where it has had a presence for almost a decade. 

It also aligns in another way. In July 2022, the International Finance Corporation (IFC) agreed to provide up to US$200 million to Olam Agri to finance the purchase of wheat, maize, and soy from Canada, Germany, Latvia, Lithuania, and the U.S. for delivery to developing markets that rely on imports including Senegal, Nigeria. Ghana, Cameroon, Chad, Bangladesh, Egypt, India, Pakistan, Thailand, and Turkey. 

Established in 2000 by two veterinarians, Avisen has grown to have a production capacity of over 100,000 tons, making it one of the country’s major suppliers of animal feed, and foundationally important to the country’s growing poultry sector. In 1973, poultry meat output in the country totaled 5,800 tons, and by 2022, had reached 142,165 tons – a CAGR of 7.14 percent.

“Avisen has earned an excellent reputation in Senegal thanks to the high quality of its products, efficient distribution network, and field teams providing technical advice to poultry growers,” said Sharad Gupta, president, integrated feed & protein business, Olam Agri. 

“Combining Olam Agri’s global commodity sourcing networks, strong manufacturing and formulation expertise with Avisen’s local market knowledge will enable us to further improve the quality and cost efficiency of feed in the Senegalese market.“

As Olam Agri is already a mainstay in the agribusiness sector with a prominent presence in other regional markets such as Nigeria, Papa Seck, CEO of Avisen, commented on the benefits of the deal, stating, “As a key player in the agribusiness industry, Olam Agri has the financial and technical capabilities to support and develop Avisen. It will bring industry best practices and a wealth of relevant experience drawn from its strong positions in other markets such as Nigeria. We are pleased Olam Agri shares our vision of growing a sustainable local animal feed industry to ensure food security for the country. ” 

“We expect continued strong growth in the poultry sector and the attendant demand for high-quality feeds, and will make necessary investments to grow our feed volumes,” added Gupta. “This is instrumental in enabling farming communities prosper and contribute to long-term food security.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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