Juhayna, Arla Foods partnership aims for €100m sales by 2020: Juhayna Chairman

Mohamed Ayyad
3 Min Read
Arla Foods owns 49% of the new company, while Juhayna owns 51% (Photo handout to Daily News Egypt)
Arla Foods owns 49% of the new company, while Juhayna owns 51% (Photo handout to Daily News Egypt)
Arla Foods owns 49% of the new company, while Juhayna owns 51%
(Photo handout to Daily News Egypt)

Juhayna for Food Industries, the largest producer of packaged dairy and fruit juice products in Egypt, estimated the sales of its joint project with the Danish dairy producer, Arla Foods, at about €100m by the year 2020, according to Safwan Thabet, Chairman and CEO of Juhayna.

“The new company will be named Argo for Food Industries, and its sales activities will be launched by October,” added Thabet. Arla Foods owns 49% of the new company, while Juhayna owns 51%.

During the signing of the partnership agreement between Juhayna and Arla Foods on Tuesday, Thabet said that the new company will work on distributing Arla Foods’ cheese, butter and infant formula products.

The new company’s issued capital is EGP 200m and will be increased to EGP 500m soon, according to Thabet. He added that starting from October, Juhayna will start manufacturing white cheese in one of Juhayna’s factories temporarily, until they acquire land to build a factory for Argo.

Peder Tuborgh, CEO of Arla Foods, said he is looking forward to launching Arla Foods’ products through Juhayna’s wide distribution network, seeking to increase its customer base in Egypt and other countries.

Tuborgh added that “the Egyptian market is unique for its huge consumer block, which requires implementing an integrated strategy to meet the needs and requirements of its different categories”.

He added that this is what they seek to achieve from the partnership with Juhayna, a company with over 30 years of experience in the Egyptian market.

Yasser El-Malawany, the former CEO of EFG Hermes, will head the new company established through the partnership between Juhayna and Arla.

Thabet said, during the conference, that Juhayna invested roughly EGP 400m in 2011, EGP 650m in 2012, EGP 1.2bn in 2013, and around EGP 400m in 2014, while it will invest about EGP 500m in 2015.

“The new project aims at developing the capacity of distributing and manufacturing cheese, butter, baby milk, and other high quality food products in the local market,” according to Thabet, adding that they are studying the regional expansion opportunities under the umbrella of the new project.

Juhayna was founded in Egypt in 1983. The company produces dairy products and juices, exporting to the Middle East, US, and European markets. Juhayna’s market share amounts to around 70% in the milk market, about 33% for yogurt, and roughly 26% for juices.

Earlier this year, Arla Foods sought to acquire Arab Dairy in Egypt; however, it withdrew its offer after conducting the technical inspection.

 

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