Tasty Food Egypt, a wholly owned subsidiary of US giant PepsiCo, is finalising its buyout of local company Chipsy for Food Industries.
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Chipsy for Food is a market leader in the production of crisps and is 67%-controlled by its founders, who have now agreed to sell their stake to Chipsy International. This new company, to be owned 83:17 by PepsiCo and Chipsy management respectively, will then make a public bid for 100% of Chipsy for Food.
The deal, carried out in this way because the government believes a tender process to be more transparent for investors during M & A transactions, values Chipsy for Food at US$112m, or US$4 a share. The tender should be completed by the end of January.
A merger of this kind will provide PepsiCo with the means to boost its regional Middle East networks and Chipsy with a good opportunity for expansion and further growth in market share.
