Saudi Arabia’s Savola Group has signed a binding share-purchase agreement through its subsidiary, Savola Foods Company, to acquire nuts company Bayara Holding for $260million. “This acquisition is a continued activation of Savola Foods Company’s announced strategy to enter attractive, value-added categories with increasing appeal within the food sector,” Savola said in the filing. The group appointed Ernst & Young as its financial adviser on the deal, it said.
The proposed acquisition is subject to the approval of the General Authority for Competition and other relevant regulatory authorities. Bayara specialises in the production of nuts, spices, grains, pulses, dried fruits and dates processing about 23,000 tonnes of goods a year. It is based in the UAE and Saudi Arabia, with operations in both Dubai and Riyadh, and employs more than 900 workers. Savola focuses on consumer staples such as edible oil, sugar, pasta and ghee.
The food conglomerate holds a 34.52% stake in Saudi Arabia’s Almarai, the biggest dairy company in the Middle East. It also has a 51% stake in Al Kabeer Group, one of the largest frozen food manufacturers in the region. Food and beverage companies in the region are increasingly evaluating acquisitions and product diversification to boost their standing in a market that previously relied heavily on food imports. Almarai in May said it plans to invest 6.6billion Saudi riyals over the next five years to expand its poultry business across the kingdom In May, it also acquired an additional stake in Riyadh-based snack maker Modern Food Industries. Abu Dhabi’s Agthia Group, one of the Mena region’s top food and beverage companies, recently completed its acquisition of Jordan’s Nabil Foods, a processed meat business, and also merged with date-processing company Al Foah deal valued at $205m.