SAUDI ARABIA—Savola Foods, a subsidiary of Saudi Arabia’s Savola Group, has acquired the total assets of food group EGYBELG, with a value of US$33.1million.

Al Ahly Pharos, the investment-banking arm of the National Bank of Egypt, acknowledged the signing of an asset purchase agreement (APA) between the two parties as to the buy-side advisor to Savola Foods.

The Saudi Savola Foods acquisition came amid plans to invest US$90.7 million in Egypt over the next two years.

This includes EGP US$38.9 million to rehabilitate the newly acquired company and US$16 million to US$21.3 million to upgrade factories and increase production capacity, Savola CEO Sameh Hassan said.

“I am delighted to announce the signing of [the] APA of The Egyptian Belgian Co., which reflects Savola’s commitment to invest in Egypt and expand their manufacturing and distribution footprint in the country,” Ahmed Heider, the CEO of Al Ahly Pharos, said.

In the same statement, Savola Foods’ CEO thanked the Al Ahly Pharos team for “their valuable contribution and commitment to the transaction”.

Savola’s target is that the snacks segment constitutes more than 10% of its revenues by the end of 2024, Hassan said. Adding that the production of snacks in Egypt is expected to start by the end of this year.

With three factories across Egypt and five production lines, Cairo-based Egybelg manufactures and distributes bakery goods.

Egybelg was the subject of another takeover approach last year from local peer Edita Food Industries, a producer of branded bakery snacks.

However, Cairo- and London-listed Edita could not reach an agreement to acquire the company, which noted in January negotiations had been suspended.

Neither Savola Group nor Egybelg had responded to Just Food’s request for details on the deal at the time of writing.

Established in 1979, Savola Foods produces edible oils, sugar, pasta and ghee marketed under a number of consumer food brands. Last summer, Savola struck a deal for fruit and nuts firm Bayara in the United Arab Emirates.

Last year, the Savola Group generated sales of US$6.5 billion, up 13% from the previous 12 months. Operating profit dropped 39% to US$269 million and net income declined 61% to US$ 105.6 million.

Liked this article? Subscribe to Food Business Africa News, our regular email newsletters with the latest news insights from Africa and the World’s food and agro industry. SUBSCRIBE HERE.