Arla Foods has agreed to form a joint venture (JV) with Egypt-based dairy company Juhayna to sell its products in the country.
The JV will add cheese, butter and infant formula to Juhayna's existing product portfolio including UHT-milk, yoghurt and juice.
Arla Foods Middle East & Africa senior vice president Rasmus Malmbak Kjeldsen said: "It is a very good match for both parties. Juhayna has a nationwide distribution network, and we are not competing within the same product categories.
"Together we now get a broader product portfolio, which strengthens the business of both parties."
Juhayna will own 51% stake in the JV, while the remaining 49% will be owned by Arla.
The new venture will initially employ close to 50 people, with plans to increase the number of employees to more than 100 in the next two years.
It will begin sales operations in October this year.
With the new JV, Arla anticipates its revenue in Egypt to exceed €90m in 2020.
"Our products will now be able to reach all corners of Egypt. Today our business is merely scraping the surface, but now we will be able to drastically expand our distribution to reach millions of new consumers," added Kjeldsen.
Arla said that the consumer demand for dairy products processed and packaged at a dairy and purchased in a store is on the rise in Egypt.
Image: Juhayna has a very limited production of butter, cheese and cream, which Arla has specialised in across the Middle East and Africa. Photo: courtesy of Arla Foods.
