Savola nets $187m in EFC sale

Saudi conglomerate Savola Group said on Saturday it has sold its 30% stake in Egyptian Fertilisers Company to Abraaj Capital of the United Arab Emirates for more than double its acquisition price.

"The group [Savola] managed... to sell its entire 30% stake in Egyptian Fertilisers Company to Abraaj Capital Group for 1.3 billion riyals ($346.7 million), achieving as a result net capital gains exceeding 700 million riyals," Savola said in a statement.

Savola teamed with a group of Arab investors under a consortium called Citadel Capital Group to buy the 30% stake in mid-2005, it said in the statement. It did not provide a breakdown of ownership in Citadel.

An official of the Egyptian company said on Thursday Abraaj bought the 30% stake in the company for $1.4 billion from Citadel. Abraaj's interest was on expectations that global demand for fertiliser will grow to generate more biofuels.

Savola had offered last year to pay 3 billion riyals to buy the remaining 70% in the Egyptian firm which has a capacity of about 1.3 million tonnes a year.

"Savola is now assessing several new investment opportunities in the petrochemical field and other promising sectors," it said.

"It is using these revenues and its own existing liquidity to fund its expansion projects and investments both inside the kingdom and... in the Middle East and some countries in North Africa and eastern Asia," it added.

Savola said in January it was focusing its expansion drive on Algeria, Iran and Egypt.

Saudi Prince Alwaleed bin Talal owns at least 13% of Savola, a holding he said in January he had boosted.

Savola reported a 2006 net profit of 1.15 billion riyals, down 4.2% from 2005 when earnings were bolstered by the 1.2 billion riyals it made from an initial public offering of dairy subsidiary Al Marai.

Savola Group said in December it would invest over 2 billion riyals in the Saudi real estate market in 2007.

Savola owns several other firms and retailers, including leading edible oil maker Afia, the Azizia Panda supermarket chain and one of the Middle East's largest sugar refiners.

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