SINGAPORE — As part of a consortium purchase of a Saudi flour mill company offered for privatization, Olam has completed purchase of its 10% share for $18 million.
In addition to Olam, the consortium includes National Agricultural Development Co., Al Rajhi International for Investment Co. and Ajlan & Bros.
As a member of the consortium, Olam will participate as the technical partner with a minority stake of 10% in Food Security Holding Company. The remaining 90% will be owned by other members of the consortium.
Olam will be responsible for managing plants and operations. The company will utilize its experience in owning and operating flour mills in West Africa.
With completion of the acquisition, the consortium owns manufacturing plants in three locations, Riyadh, Hail and Jazan, with a combined wheat milling capacity of 1.3 million tonnes and feed milling capacity of 180,000 tonnes.
‘This investment supports our strategy to expand our wheat milling footprint in key markets across Africa and the Middle East,” said Saurabh Mehra, president of Olam’s wheat milling business. “Over the past decade, Olam has built a world-class wheat milling business and established itself as a leading miller in Africa. This acquisition is part of our entry strategy into the Kingdom of Saudi Arabia. The JV will allow us to leverage our best-in-class technical expertise while gaining valuable insight into doing business in the country.”