Sources say dairy firm is interested in buying majority stake in National Food Products Company
Saudi Arabian dairy firm Almarai is interested in buying a majority stake in National Food Products Company (NFPC), four sources familiar with the matter told Reuters.
The Gulf's largest dairy firm, Almarai, is among several companies to have shown an initial interest in NFPC, one of the largest food and dairy manufacturers and distributors in the United Arab Emirates (UAE), according to one of the sources.
Potential bidders for the stake, which sources told Reuters in October was being valued at up to $1.5 billion, are due to register their interest with the firm by the first week of January, a second source said.
NFPC markets brands including Milco, Lacnor and Oasis bottled water and also has a joint venture with Danish dairy giant Arla Foods.
It declined to comment when contacted by Reuters on Monday, while Almarai did not respond to several requests for comment.
Almarai is looking to spend up to 21 billion riyals ($5.6 billion) in investment between 2016 and 2020 to expand its business, including in the areas of farming, manufacturing, distribution and logistics, it said in May.
The Saudi firm announced on Monday it was planning to boost its capital by a third next year through the issuance of bonus shares to help support growth plans outlined earlier this year.
NFPC was founded by Lebanese-born businessman Fady Antonios, who serves as president and chief executive of NFPC and the local Bin Hamoodah Group.
NFPC appointed Clifford Chance as its legal adviser on the transaction in recent days, according to a separate source, a UAE-based lawyer.
It joins financial adviser Emirates Investment Bank, which is managing the sale and which began pitching the deal to potential buyers at the end of October, the second source said.
The Gulf has seen a number of food industry deals this year, including for stakes in Saudi fast food chain Kudu and gourmet date brand Bateel, as investors seek to tap into sectors benefiting from spending by increasingly wealthy local consumers.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.