Value of MENA food, beverage M&A reaches 8-yr high

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The deal value of the MENA region’s food and beverage mergers and acquisitions (M&A) in 2016 reached $3.4 billion, up from $402 million in the previous year, according to Mergermarket.

The value is considered the highest since 2009, while the outlook for 2017 seems promising with four deals worth $104 million already announced since January, according to the Mergermarket’s MENA Mergers 2017 forum in Dubai, which was held on Monday.

The 2017 pipeline, which is expected to propel in the second half of the year, kicked off with Nestle acquiring Egypt’s Caravan Marketing Company, owner of Bonjorno, for $33 million. The forum also mentioned Brazilian meat producer BRF’s sale of a stake in its halal food unit One Foods, estimated at a value of $5 million.

Expected deals for the rest of the year include Emirates Modern Poultry Co (Al Rawdah), mulling a $20 million to $30 million joint venture, and Lebanese Shawarmanji, which is in discussions with a private equity firm over a stake sale and is preparing to launch 50 outlets in Saudi Arabia over the next seven years.

“Food and beverage continues to be a hot sector for M&A in the MENA region. A number of successful concepts are expanding throughout the region through opening company-owned locations or franchising. Most deals in this space will likely be seen in the UAE, Saudi Arabia, and Egypt,” head of Mergermarket MENA Ruth McKee Al Ghamdi stated.

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