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Acquisition of Kuwait’s food and beverage players

Date : 28/09/2017
Author:  Abdulrazzaq Razooqi

Kuwait-Acquisition.jpg
Over the past couple of years, Kuwait food and beverage players have sparked the interest of both regional and international acquirers. Kuwait’s high per capita food consumption, strong purchasing power, and rising population worked to justify that interest. As such, regional and international players wanted to take part of this growing market. They could decide to either establish their own operations or acquire the operations of existing players with a strong market presence, solid customer base, and high brand recognition.


Back in 2014, Brazilian food conglomerate, BRF, decided to acquire a 75% stake in Al Yasra Food’s frozen food division. With a total transaction value amounting to US$160 million, BRF effectively had acquired one of its distributors, which it had recently replicated with Oman-based Al Khan Foodstuff. With this acquisition, BRF had taken control of the distribution of its products in Kuwait, while leveraging the strong platform and local knowledge Al Yasra had built over the years. While BRF’s acquisition of Al Yasra seemed to be large at the time, it was only a couple of years until Kuwait Food Company (Americana) stole its thunder by getting acquired for a total of US$3.26 billion. The news about Americana’s sale dates back to 2014, when bidders such as Savola, KKR, CVC Capital Partners, and others lined up to acquire Kuwait’s largest food and beverage conglomerate. However, it was not until UAE-based Adeptio Investments expressed its interest in acquiring the major shareholder’s stake, that the transaction began to materialize. Adeptio had in effect acquired a food and beverage behemoth with operations spanning manufacturing and food and beverage outlets across the Middle East and a market capitalization of US$3.5 billion. While BRF’s acquisition of Al Yasra’s frozen food division represented an extension of the former’s operations, Adeptio’s acquisition of Americana was different. Adeptio was in effect is an investment company, who believed in Americana’s strong name and presence in the region. Its acquisition demonstrates belief in the strong value Americana brings today and the tremendous potential it has in the future. The success of Al Yasra and Americana has worked to attract both regional and international players to Kuwait. It exemplifies the strong potential that lies within the Kuwaiti market and the very companies that fuel its continued growth. 

This article is published in Markaz Newsletter 'engage'

Tags:  acquisition, and, beverage, food

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