Transaction enables Agthia to enter the Saudi market for the first time with its Al Ain water brand
Abu Dhabi, UAE; 28 March 2017: Agthia Group (‘Agthia’ or ‘the Group’), a leading food and beverage group in the UAE, has completed its acquisition of water business of Delta Marketing Company, providing Agthia with a fully-fledged water business in the Kingdom of Saudi Arabia. Agthia had signed a share purchase agreement to acquire a 100 percent stake in water business of Delta Marketing Company in November 2016.
Tariq Al Wahedi, Acting Chief Executive Officer of Agthia; Mr. Hassan Alireza, Managing Director of Delta Marketing Company; Fasahat Beg, Executive VP – Water, Beverage, Dairy, and Ahmed Anwar, Acting Country Manager-KSA at Agthia, marked the conclusion of the transaction with a ceremony attended by employees at the business’ manufacturing facility in Jeddah.
Commenting on the acquisition, HE Eng Dhafer Ayed Al Ahbabi, Agthia Chairman, said: “Taking ownership of Al Ain Water’s production in Saudi Arabia, the GCC’s largest consumer market, represents a significant milestone in Agthia’s regional growth. The acquisition provides Agthia with the facilities, network and talent that will allow us to grow Al Ain brand across the Saudi Arabian market. Over the coming years, Agthia plans to expand its operations in Saudi Arabia, leveraging its operational and industry expertise to develop a thriving water business as part of our commitment to deliver sustainable growth for our shareholders.”
Tariq Al Wahedi, Acting Chief Executive Officer of Agthia, added: “Regional expansion, especially in our water business, is a core part of our strategy. The ability to produce and distribute Al Ain Water in the GCC’s largest consumer market will further strengthen our position as a leading food and beverage group in the region.”
Mr. Hassan Alireza, Managing Director of Delta Marketing Company, concluded: “We are pleased to close this transaction with Agthia, a company that can build upon our 30 years of history and continue to provide our customers and consumers with the best products. Finding a trusted partner to pursue these objectives and to take the business to its next level of growth and development was a priority. This transaction will offer genuine opportunities to the employees and provide them with the prospect of working for one of the GCC’s leading companies.”
In line with the Group’s strategy to expand its presence across the GCC, Agthia will now own production of Al Ain Water, the UAE’s leading bottled water brand, in KSA for the first time. The company has three water brands mainly in the Western Region of the country: Delta Water, a premium product available in large size dispenser bottles of 5 and 6 gallon; Al-Ain, its largest selling brand produced in a range of sizes from dispenser bottles, regular PET bottles and cups; and Bambini the first water in the Middle East specifically designed for the preparation of baby food and available in regular PET bottles. The Company also operates a bulk water activity which is mainly targeted for large industrial processing companies.
Agthia is pursuing a five-year strategy aimed at becoming one of the Middle East’s leading food and beverage companies. The cornerstone of this strategy is expanding the Group’s water business. Last year, Agthia entered into a joint venture in Kuwait to establish a water bottling plant, which is expected to be completed later this year. Agthia also owns two other water brands: Al Bayan, a leading player in the 5-gallon bulk water segment in the UAE and Oman; and Alpin, a natural spring water produced in Turkey.
Agthia reported net profit of AED 254 million in 2016, an increase of 10 percent on the previous year, with net revenues rising by 8 percent to over AED 2 billion. The Group’s water business represented 32 percent of total revenues in 2016 at AED 652 million, a 20 percent rise on 2015.