The Egyptian Financial Supervisory Authority (EFSA) approved Monday Al-Nour Company for Dairy Product’s bid to purchase all shares of the stock-listed Arab Dairy Product Company (ADPC), the regulatory body said.
Al-Nour made its offer to acquire 100% of Arab Dairy shares, with a minimum of 51% of its stakes, with the value of EGP 58 per share.
In early December, Swedish-Danish Arla Food, the world’s 7th largest dairy firm, announced it will not complete a bid for all shares of Arab Dairy after a thorough investigation into the company.
“Our conclusion, based on the due diligence, is that we shall not place a final tender offer for Arab Dairy,” said Finn Hansen, Executive Vice President for Arla’s international business group in a statement.
Arab Dairy started production in 1990 in Egypt, and currently exports to countries across the Middle East. It registered a loss of EGP 24m in the first nine months of 2014, according to its statements.
Egyptian dairy product exports amount to approximately $25m each year, out of $179m in juice and beverages exports, according to the Food Export Council.
Another acquisition dispute is currently ongoing between UAE’s Abraaj Group and US-based Kellogg’s to acquire 51% shares of BiscoMisr. Egypt’s main producer of biscuits and cakes has had prices of shares reaching EGP 89.
In a similar move, the EFSA approved, in June, an offer submitted by a Beltone-Sawiris alliance to acquire 20% of the EFG-Hermes. However, the acquisition was not completed as the alliance refused the rate offered for purchase.
Mergers and acquisition transactions in the Middle East have grown by 250% in the second quarter (Q2) of 2014 compared to the previous quarter, recording a value of $14bn. The figures come as part of a Thomson Reuters’ quarterly investment banking analysis on the Middle East, published in July.
The report noted that this is the highest registered quarterly value since Q1 of 2011. However, on a larger scale, it added that the value of M&A deals during the first half (1H) of 2014 has declined 4% from the same period in 2013, highlighting $19.7bn in total.