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May 11, 2020

BRF enters deal for Joody Al Sharqiya Food Production Factory in Saudi Arabia

Brazilian meat processor BRF said its indirectly-owned subsidiary Badi Ltd. has struck a deal to acquire a factory in Saudi Arabia.

By Dean Best

Brazilian meat processor BRF said its indirectly-owned subsidiary Badi Ltd. has struck a deal to acquire the Joody Al Sharqiya Food Production Factory in Saudi Arabia.

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What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
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The price of the transaction with the seller, Hungry Bunny Ltd., has been set at around US$8m. The deal for 100% of the capital stock of food processor Joody Al Sharqiya was signed on 7 May and is subject to clearance by the relevant regulatory authorities, BRF said in a statement.

Joody Al Sharqiya’s production facility is located in Dammam, the capital of the Eastern Province of Saudi Arabia, and produces breaded and marinated cuts of meat, and hamburgers. 

BRF said it plans to invest around $7.2m in the plant to increase annual output to 18,000 tons a year, from 3,600 tons. The Brazilian firm added the move is part of its strategy to establish a local manufacturing base and to further expand its “high value-added product portfolio”.

The meat processor said the deal for Joody Al Sharqiya is not connected with a plan to build a chicken plant in the Kingdom, as was announced in October last year.

BRF said then that it had entered a non-binding agreement with the Saudi Arabian General Investment Authority, the foreign investor promotion agency, to construct the facility at a cost of $120m. The plant will manufacture breaded and marinated chicken products and with burgers destined for the local market and other countries in the Middle Eastern region. 

“The development of this project is currently in the technical specification and financial modelling phase,” BRF said as an update in its latest statement.

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Free Report
img

What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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