Riyadh - Sharikat Mubasher: The Saudi Agriculture and Livestock Investment Company (SALIC), the food and agriculture investment arm of the Public Investment Fund (PIF), entered into a definitive agreement to acquire a 44.58% stake in Olam Agri Holdings, a subsidiary of Olam Group Limited (OGL), for around $1.78 billion.
The transaction values Olam Agri at $4 billion, higher than the $3.5 billion valuation in December 2022, when it sold a 35.4% stake to SALIC, and will give SALIC an 80.01% controlling stake in the business, a recent statement by OGL revealed.
Upon the completion of the transaction, SALIC will have a call option to acquire the remaining 19.99% stake in Olam Agri. Both parties agreed to allow a dividend payout from Olam Agri in respect of profits generated in the second half of 2024, of up to a maximum of $110 million.
Sulaiman AlRumaih, Group CEO of SALIC, said: “The full acquisition agreement of Olam Agri aligns with SALIC’s strategic objectives of diversifying sources of essential commodities, strengthening supply chain integration, and enhancing logistical efficiency across its local and international investments. Furthermore, this acquisition underscores SALIC's ambition to secure a key position in the global grains sector.”
He affirmed that the partnership will contribute to achieving national and global objectives while continually enhancing production efficiency for the benefit of all stakeholders.
For his part, Sunny Verghese, Co-founder and Group CEO of OGL, commented: “The sale of Olam Agri to SALIC marks another key milestone in Olam’s Re-organisation journey announced in January 2020. With this transaction, we can now focus our attention on seeking strategic options to unlock value for the remaining Olam Group businesses and ofi, including the pursuit of an ofi IPO.”
Olam Agri focuses on high-growth consumption markets with a deep understanding of market needs, a global origination, trading, and marketing footprint, with best-in-class logistics, processing, and risk management capabilities.