Lactalis enters race to acquire Egyptian cheesemaker Arab Dairy
The EGP 66 (US$9.23, €7.36) per share takeover bid was tabled earlier this week by a coalition of Middle Eastern Lactalis-owned businesses - Al-Nour for Dairy Industries, Best of France for Dairy Products, and Best Cheese Company for Dairy Products.
The offer letter, written in Arabic, was published on the Egyptian Exchange website yesterday by Arab Dairy.
In an accompanying statement, Arab Dairy said a decision on whether to proceed with the EGP 66 per share Lactalis offer would be made during its November 23 board meeting.
Lactalis, which has been present in Egypt for more than 10 years, declined to discuss its interest in Arab Dairy when approached by DairyReporter.com.
The French dairy's bid to acquire Arab Dairy tops two made earlier this month.
On November 4, Cairo-based private equity group Pioneer Holdings, which holds a 24% stake in Arab Dairy, unveiled a EGP 56 (US$7.83, €6.25) per share acquisition proposal.
The next day, Saudi Arabian firm Arrow Food Distribution tabled a takeover bid of EGP 57.12 (US$7.99, €6.37) per share.
In a letter detailing the proposed share purchase, Arrow Food Distribution said a controlling interest in Arab Dairy would provide a "unique and valuable opportunity to develop further its activities in the region."
“Similarly, Arab Dairy Products Company would benefit from the strong distribution capabilities of Arrow and its access to other Middle East markets.”
Months earlier, in September 2014, European dairy cooperative Arla Foods announced a non-binding EGP 65 (US$9.09, €7.25) bid to acquire a stake of up to 100% in Arab Dairy.
Arla said then it was entering into a period of due diligence to assess the "more sensitive aspects of Arab Dairy's business which are not published in its annual reports."
Speaking with DairyReporter.com today, Theis Brøgger, spokesman, Arla Foods, said the company is close to a conclusion.
"With the due diligence process ongoing we have no comment to make," he said.
"When it is concluded we'll announce our intentions."
Arab Dairy controls, according to Euromonitor data, the seventh largest share of the Egyptian cheese market.
Specializing in feta, Swiss, mozzarella and processed cheese, Arab Dairy is best known for its Panda cheese brand.
As well as marketing products in Egypt, the company exports to Lebanon, Libya, Jordan, Yemen, Kuwait, Iraq, Saudi Arabia, Qatar, Bahrain, UAE, Syria, Albania, South Africa, and the US.