Saudi dairy group enters poultry business

Almarai, a Saudi Arabian dairy group, is entering the poultry business by acquiring local agribusiness Hail Agricultural Development Co (Hadco).

Almarai, which is the Gulf's largest dairy firm, has reached an agreement to buy all shares in Hadco. The Hadco board had accepted the bid, valued at 30.1 riyals per share, which is 3.4-percent above close on Tuesday (Jun 30).

For each five Hadco shares, shareholders will get one new Almarai share and SAR2.50, meaning Almarai will issue six million new shares, which represents a 5.5-percent capital hike.

The deal values Hadco at about SAR949.5 million, Almarai said. The group initially offered SAR22.25 to Hadco's shareholders in November.

Almarai has been diversifying its revenues through acquisitions and has earmarked SAR6 billion for investments to expand outside the Gulf region, according to Trade Arabia.

Hail Agriculture Development Company is a Saudi Arabia company engaged in the production of agricultural and animal products, including wheat, alfalfa, yellow corn, dates, grapes, chicken, poultry feed and animal feed.

US$1 = SAR3.75037 (Jul 3)