Investment fund Qalaa Holdings is contemplating the sale of its remaining Egyptian food businesses, confectioner Rashidi El-Mizan and dairy firm Dina Farms.
According to the company, Rashidi El-Mizan is Egypt’s market leader in halawa and tahini products. Dina Farms, Qalaa says, is the “largest private-sector dairy farm” in Egypt and Africa and the “top” fresh packaged milk producer in the country.
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Qalaa expects to generate in the region of US$300m through the disposals, the company said.
The packaged foods industry in Egypt has recently seen an uptick in M&A activity. Last month, Kellogg secured 86% of Egyptian snack group Bisco Misr for a $125m. Meanwhile, Lactalis and private-equity firm Pioneers Holding are engaged in a takeover battle for Arab Dairy.
Qalaa said it has been approached by a number of companies regarding the sale. “We have been approached by more than one party interested in potential transactions regarding our key investments in the agrifoods sector; we have a clear duty to shareholders to fully explore our options in this respect,” said Qalaa chairman and founder Ahmed Heikal.
Qalaa co-Founder and MD Hisham El-Khazindar added the disposals would allow the company to invest in growth and pay down debt. “Any divestiture would achieve the twin aim of significantly accelerating the deleveraging of Qalaa, while simultaneously funding growth opportunities in core subsidiaries… This will hasten our return to profitability, which we would now anticipate in 2015 as opposed to next year as we had originally envisioned.”
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By GlobalDataQalaa has hired EFG Hermes Investment Banking to advise on the potential sale.
