Abu Dhabi food and beverage firm Agthia Group is poised to take a majority stake in Egypt-based spices and biscuits supplier Abu Auf Holding.

Agthia, majority-owned by state investor Abu Dhabi Development Holding Company (ADQ), plans to take a 60% interest in Abu Auf, subject to regulatory approval. The founders of the Egyptian business, set up in 2010, will retain 30%, while Cairo-based Tanmiya Capital Ventures will keep 10%, according to a stock-exchange filing.

The private-equity firm invested in Abu Auf 2019. Contacted by Just Food, a spokesperson for Agthia would only confirm that Tanmiya Capital acquired a minority interest in 2019 and is now winding that down to 10%.

Abu Auf, located in New Cairo, manufactures a range of consumer products sold via the direct-to-consumer channel and through 200 retail outlets in Egypt, and three that recently opened in the United Arab Emirates. The business supplies markets in the Middle East, Asia, Europe and the US.

Financial terms were not disclosed for the stake in the Egyptian company, which generated revenue of AED236m (US$64.2m) in the year to 31 December and EBITDA of AED58m.

Alan Smith, the CEO of publicly-listed Agthia, which has been active in M&A in recent years, said Abu Auf “is an important strategic target for Agthia to boost growth in our snacking and healthy food verticals, as we continue to adopt a more consumer-centric business model”.

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He added: “In addition to immediate access to new revenue streams and product lines, we are excited to expand our presence in Egypt and utilise the acquisitions made last year to further strengthen our operations and market revenue base.”

In 2021, Agthia acquired UAE-based BMB Group, a supplier of confectionery and snacks, adding to a majority interest in both Egyptian meat business Atyab and peer Nabil Foods in Jordan. In 2020, it bought Kuwaiti bakery firm Al Faysal Bakery and Sweets and instigated a merger with Abu Dhabi-based date processor Al Foah Co.

Abu Auf also supplies dates, along with dried fruits and cooking oils, and in the healthy foods segment, protein bars, granola and honey. Beverages include tea and coffee, and fruit juices.

Its CEO Ahmed Auf said: “Following our partnership with an institutional investor in 2019 to further accelerate growth and institutionalise the company, we believe we are now ready for the next step in our journey. We would like to thank our employees, customers and suppliers for their continued support and are very excited by the prospect of partnering with Agthia to expand our reach, realise our potential and grow our footprint in the UAE and beyond.”

In the year to 31 December, Agthia posted revenues of AED3.1bn and EBITDA of AED452m. Employing more than 8,000 people, the company generated a net profit of AED216m.