“The acquisition of Fan Milk represents the largest FMCG private equity transaction in Sub-Saharan Africa, outside South Africa,” said Abraaj Group founder and group CEO Arif Naqvi.
“We look forward to partnering with Danone in order to accelerate the growth and penetration of Fan Milk’s portfolio of leading consumer food brands across West Africa.”
Fan Milk is West Africa’s leading manufacturer and distributor of frozen dairy products and juices. It currently operates in Ghana, Togo, Nigeria, Benin, Ivory Cost and Burkina Faso.
The Abraaj Group had previously announced an agreement to acquire a 100 per cent stake in Fan Milk through one of its funds in June 2013.
The group and Danone will now however respectively acquire a 51 per cent and 49 per cent stake in Fan Milk International.
Under the agreement, Danone will in the coming years gradually acquire a controlling stake in the business.
“This transaction represents a major step in Danone’s expansion in Africa. Fan Milk is a company with a unique business model driven by a neighbourhood sales and distribution platform working through 31,000 independent vendors,” said Danone co-chief operating officer Emmanuel Faber.
“Danone is already present in North and South Africa, and we will now be able to develop the dairy product market in West Africa.”
The Abraaj Group has made over 70 investments in the continent, including the recent acquisition of stakes in Ghana Home Loans and Ivory Coast’s African Industrial Services. Abraaj is also invested in Brookside Dairy, the leading dairy in East Africa.