UAE-based conglomerate Al Dahra, which specialises in the agribusiness sector, has signed an agreement to acquire the assets of PKB Korporacija and its subsidiaries in Serbia for EUR150 million ($172.5 million).
The acquisition is being undertaken as a result of Serbia’s objective to privatise PKB Korporacija, and follows a public tender issued in August, state news agency WAM reported.
The agreement was signed by Khadim Al-Derei, vice chairman and managing director of Al Dahra, and Dragan Stepanovic, Serbian Deputy Minister of Economy.
The operations that will be acquired from PKB Korporacija cover several agricultural and food sector activities. In terms of farming, Al Dahra will manage and cultivate more than 50,000 acers of farmland, which is spread across eight farms, close to Belgrade city centre.
The different crops that will be produced include sugar beet 491 hectares; sunflower 2,136 hectares; wheat 3,552 hectares; corn 636 hectares; barley 1,454 hectares; soya 2,621 hectares; oilseeds 1,141 hectares; forage 2,322 hectares; silage 2,775 hectares; and a compound of feed and several vegetable varieties, WAM said.
It added that Al Dahra will also manage the dairy operation and livestock business, which sell to the milk and meat production industries in Serbia.
Al Dahra has agreed, as part of the transaction, to invest EUR30 million over the coming three years to enhance the farms, upgrade the irrigation infrastructure and modernize the dairy operation facilities. The company said it is willing to invest a further EUR15 million to optimise the farm and facilities.
Al-Derei said: "The signing of the agreement is a special day for the UAE and Serbia. The addition of the PKB assets to our existing portfolio reinforces our position in Serbia and our regional presence in Europe and complements our vertical integration strategy, allowing the group to further grow in the grains trading, dairy and livestock segments.
"We believe that the privatisation of PKB and the investments that Al Dahra will be injecting to upgrade the existing operations and infrastructure, will enhance the commercialisation and internationalisation of Serbian crops and will ultimately benefit the Serbian farmers, traders and wider agricultural sector."For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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