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UAE dairy firm quits stake sale on valuation mismatch

ABU DHABI, June 23, 2016

The owners of National Foods Products Company (NFPC) have abandoned the sale of a majority stake in the Abu Dhabi-based firm after final round bids failed to meet their valuation, sources aware of the matter said on Wednesday.

Shareholders in NFPC, one of the largest food and dairy manufacturers in the UAE, whose brands include Milco, Lacnor and Oasis bottled water, had been aiming to raise up to $1.5 billion from the sale of up to 51 per cent of NFPC.

However, none of the final round bids which had been due by a June 9 deadline was acceptable to the board of NFPC and the planned sale was pulled, according to two UAE-based sources who spoke on condition of anonymity as the information isn't public.

NFPC couldn't be reached for comment.

Those who had expressed initial interest included US private equity giant KKR in partnership with Dubai-based investment house Fajr Capital and Saudi Arabian dairy firm Almarai, sources had said last month.

However, the KKR and Fajr team did not ultimately lodge a final bid, according to two separate sources and one of the UAE-based sources, who added Almarai expressed interest in negotiating a transaction but with a number of conditions.

Aseer Al Arabia for Industrial Investment, a Saudi firm which owns a majority stake in food producer Halwani Bros , did submit a bid, the UAE-based source added.

KKR and Fajr declined to comment. Almarai couldn't immediately be reached for comment. Aseer Al-Arabia couldn't be reached for comment.

One of the main points of contention was NFPC's plans to shift most of its production to a new facility in the Kizad industrial free zone in Abu Dhabi, with bidders concerned about the expense and disruption such a move would cause, the UAE-based source and another source said.

NFPC broke ground on the 752,000 sq m facility in February, with operations expected to start in the first quarter of 2018, local press reports stated earlier this year.

NFPC, which also has a joint venture with Danish dairy giant Arla Foods, was founded by Lebanese-born businessman Fady Antonios and the local Bin Hamoodah group.

Emirates Investment Bank was advising the sellers.-Reuters




Tags: Sale | NFPC | UAE food company |

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