Agthia group to acquire Kuwait’s Al Faysal Bakery and Sweets

The Kuwaiti firm reported net revenue of Dh92m last year and employs 500 people

Agthia, the food and beverage company that produces Al Ain water, signed a sales purchase agreement to acquire Kuwait's Al Faysal Bakery and Sweets. Delores Johnson / The National

Agthia Group signed a sale and purchase agreement to acquire Kuwait’s Al Faysal Bakery and Sweets as the Abu Dhabi-based food and beverage company continues to expand its portfolio.

The deal is the second acquisition in a month for Agthia, part of one of the region’s largest holding companies, ADQ. The transaction will allow Agthia to expand its footprint in Kuwait as a diversified consumer-centric food and beverage player, it said in a statement to the Abu Dhabi Securities Exchange, where its shares trade.

It did not disclose the financial details of the deal.

“Our decision to acquire Al Faysal Bakery and Sweets in Kuwait aligns with our strategy to further build our regional F&B footprint, adding significant scale to our existing operations in Kuwait and further diversifying our portfolio,” Alan Smith, chief executive of Agthia Group, said on Thursday. “The acquisition will be accretive to Agthia’s existing platform and we expect to generate significant revenue and cost synergies”.

Al Faysal Bakery and Sweets is one of Kuwait’s top bakeries, which recorded net revenue of Dh92 million at the end of 2019. It employs more than 500 people and serves retail food outlets in the country.

“The acquisition ... underscores our priorities to deliver value to our shareholders,” Khalifa Sultan Al Suwaidi, chairman of Agthia and chief investment officer of ADQ, said.

"This acquisition will support the Group’s strategic growth."

Agthia's board earlier this also month approved a merger with Al Foah, the world's largest date processing and packaging company.

The deal follows ADQ-owned industrial conglomerate General Holding Corporation (Senaat), submitting a non-binding offer to the Agthia board to swap its shares in Al Foah last month.

Senaat is transfering the entire issued share capital of Al Foah to Agthia for 120 million convertible shares in Agthia at Dh3.75 a share. Senaat will own 59.17 per cent of Agthia, up from 51 per cent currently upon completion of the deal.

Established in 2004, Agthia’s assets are located in the UAE, Oman, Kuwait, Saudi Arabia, Egypt and Turkey. It manufactures a variety of brands in different categories including water and beverages, flour and animal feed, processed fruits and vegetables, dairy and frozen products.