UAE food business Agthia Group plans to take a majority stake in Jordan-based meat-products firm Nabil Foods.
Publicly-listed Agthia, which is majority-owned by state-run investor Abu Dhabi Development Holding Company (ADQ), will take a 60% stake in Nabil Foods via the issuance of convertible bonds.
The bonds can be converted into shares of Agthia at a price of AED5.5 each, which local media reports have suggested implies an equity value of around AED394m (US$107.2m).
Agthia is conducting the transaction through Nutrivation Holding Ltd., which holds the 60% stake in Nabil Foods through its owner Oriongreen Ltd. Nutrivation is a holding company of ADQ.
In turn, ADQ is the majority shareholder of Agthia through the industrial conglomerate General Holding Corporation PJSC, also known as Senaat.
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Nabil Foods was founded in 1945 and manufactures frozen and chilled meat, poultry and fish products such as ready meals, kebabs and burgers, but also cookies, desserts and pastries.
Agthia, which supplies markets in the Middle East, said the deal is subject to regulatory and competition authority approvals. It also has the option to acquire a further 20% stake in Oriongreen – indirectly Nabil Foods – from another company Ideal Holding Ltd.
just-food has approached Agthia for management comments on the deal but had not received a reply at the time of writing.
Founded in 2004, Agthia produces food and drink products such as bakery, yogurts, frozen vegetables, convenience foods, juices and waters. As well as the UAE, it has operations in Saudi Arabia, Oman, Kuwait, Egypt and Turkey.
Late last year, Agthia announced it planned to acquire Kuwaiti bakery firm Al Faysal Bakery and Sweets. The same week, the UAE business then revealed shareholders had approved a merger with Abu Dhabi-based date processor Al Foah Co., which was then owned by Senaat. Under the deal, Senaat agreed to transfer all its shares in Al Foah to Agthia in exchange for an increased stake in the business.
Meanwhile, Agthia has recently appointed a new chief executive. Alan Smith was named as its new CEO last July to replace Jamal Salem Al Dhaheri, who had been heading up the business on an interim basis since March 2020.
In its most recent annual report for the year ended 31 December 2019, Agthia generated revenues of AED2.04bn and a net profit of AED137m. The company employs around 4,035 people.