CAIRO: A memorandum of understanding was signed between the Savola Group and Al Muhaidib Company to incorporate Savola Foods Company, according to a press statement.
Sami Baroum, managing director of Savola Group, announced in a press conference held on May 20 that this step aims to “enhance the food security for Saudi Arabia to meet its basic food needs through a strategic partnership with Al Muhaidib Company, a regional player in the agro foods sector.
The agreement is also expected to help the company strengthen its position in the edible oils and sugar sectors and build on its strong presence in the Egyptian and Sudanese markets, said the statement.
Sulaiman Al-Muhaidib, chairman of Al-Almuhaidib Company, said this step will help the two partners “leverage the potential synergies between their businesses and expand into new food businesses.
The two partners will expand internationally in rice, particularly in the Egyptian and Pakistani markets. Savola Group, the leading Saudi conglomerate owns 90.7 percent of Afia International Co., one of the leading edible oils companies with operations across the Middle East, North Africa and Central Asia.
Also the group manages its shareholding in sugar sector through its subsidiary Savola Industrial Investments Co. (SIIC), in which Savola owns 63.5 percnet and Al-Muhaidib owns 36.5 percent.
The latter controls 64.8 percent of United Sugar Company (USC), which owns the third largest sugar refinery in the world and controls United Sugar Company of Egypt, a new refinery. Baroum indicated that the Savola Group will increase its stake in the sugar business by acquiring the remaining shares in SIIC from Al-Muhaidib Co. and expanding into the rice business by taking Al-Muhaidib rice expertise into the international markets.
Al-Muhaidib took shares in SFC with an ultimate shareholding of 80/20 between Savola and Al-Muhaidib.
