UAE’s Agthia eyes further acquisitions to drive growth across Middle East by 2025

PUBLISHED: Mon, 12 Apr 2021 09:06:00 GMT

By Yousef Saba

DUBAI, April 12 (Reuters) – Emirati food and drinks group Agthia announced on Monday plans to become an industry leader in the Middle East and North Africa by 2025 through tighter efficiency and possibly further acquisitions, after a blitz of recent deals.

The company has identified Egypt and Saudi Arabia, along with Kuwait, Oman and Turkey, as key markets in which it is seeking to expand further, Chief Executive Alan Smith told Reuters in a phone interview.

“Those markets will be our priorities. Anything beyond that would really depend on how exciting the proposition is, whether there’s a good reason or belief to win and whether it’s kind of synergistic with what we have,” he said.

Pakistan, in which Agthia currently has no operations, is also “on our radar”, he added. “But I think it’s fair to say our focus is MENA.”

Agthia has made cost savings of 200 million dirhams ($54.5 million) in the past four years and aims to save the same amount through 2025 via synergies, Smith said.

The group is also planning to expand its capabilities through strategic hiring, having added a number of executives to the payroll recently with experience in large multinationals.

Agthia, whose products include bottled water, frozen foods and baked goods, reported net attributable profit of 34.5 million dirhams last year, down 75% from a year before.

While its $1.3 billion market capitalisation is some way below regional rivals such as Saudi Arabia’s Almarai and Savola Group, it has recently been expanding through acquisitions.

Last week, Agthia’s board approved the acquisition of three quarters of Ismailia Agricultural and Industrial Investment, which produces frozen chicken and beef products under four brands in Egypt.

Smith said that deal was mainly financed with bank debt, declining to give details.

Agthia acquired UAE dates company Al Foah in November and Saudi frozen proteins group Nabil Food Industries in January, a deal still subject to regulatory approvals. It has also acquired Kuwait’s Al Faysal Bakery and Sweets.

($1 = 3.6728 UAE dirham) (Reporting by Yousef Saba; Editing by Jan Harvey)

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