Trade Resources Company News Saudi Arabia's NADEC to Acquire Al Safi Danone

Saudi Arabia's NADEC to Acquire Al Safi Danone

Tags: NADEC, ASD

National Agricultural Development Company (NADEC) has agreed to acquire 100% of Al Safi Danone (ASD) for an undisclosed price to consolidate its position in Saudi Arabian dairy market.

ASD is a joint venture between the Saudi Arabia-based Al Safi Dairy Farm and French dairy producer Danone Group.

On the other hand, NADEC is an agricultural and food-processing company that operates in Middle East and North Africa. The government of Saudi Arabia owns 20% in NADEC with the remaining 80% ownership publicly traded on the Saudi Stock Exchange.

The acquisition will be executed through a capital increase in NADEC.

According to NADEC, the transaction will create a wider brand portfolio in the fresh dairy, long life dairy and juice segments. It will also boost the regional reach of NADEC in Saudi Arabia, UAE, Kuwait, Bahrain, Lebanon and Jordan apart from gaining access to new regions like Iraq, Oman and other countries.

As per the terms of the transaction entered with Al Safi and Danone Dairy Investments Indonesia (DDII), NADEC will own 61.25% in the enlarged company, post acquisition. The rest of the 38.75% stake will be given to the existing ASD shareholders.

ASD chairman Mohammed A. Al Sarhan said: “Our vision from this business combination is to use the unique capabilities of both companies to better serve customers in KSA and in the region, maintain the highest quality standards and continuously introduce new product innovations.

“We believe this Transaction will initiate a highly beneficial transformation of the dairy market and generate significant synergies that will drive value for all stakeholders.”

NADEC said that the acquisition will help in contributing to the objectives of Saudi Arabia’s Vision 2030 by boosting the private sector.

NADEC managing director Abdulaziz Al Babtain said: “ASD’s iconic product portfolio comprising Al Safi and Danone-branded products will be highly complementary to NADEC’s existing product offering.

“The transaction will allow both companies to better serve customers and realise benefits not available on a standalone basis.”

The acquisition will be subject to various conditions including an approval of the General Authority for Competition.

Source: http://dairyproducts.food-business-review.com/news/saudi-arabias-nadec-to-acquire-danones-joint-venture-with-al-safi-260318-6094676
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