MUSCAT: Oman Flour Mills (OFM), one of the largest integrated food companies in the Sultanate of Oman, has lined up mergers and acquisitions with a number food related businesses in Oman and the wider Gulf region. The transactions, when completed by around the middle of next year, will vault majority state-owned OFM into the ranks of the biggest food sector players in the Middle East.
The planned mergers and acquisitions, according to OFM, are part of a strategy designed to support the group’s integration across the value chain, as well as its diversification into new ventures. Besides its mainstay flour milling, bakery and feed mill operations, the parent group also has interests spanning the dairy, poultry, grain storage and trading, pasta products, and food diagnostics sectors.
The most significant of the big acquisitions planned by OFM centres on a yet unnamed industrial bakery, with a final investment decision anticipated before the end of this year.
“The valuation process for acquiring a large industrial bakery has been completed. Atyab Investment is moving forward with a non‐binding offer, while Financial Due Diligence (FDD) and Legal Due Diligence (LDD) are underway,” said Ahmed bin Ali al Balushi, Chairman, Board of Directors – OFM, in the latest financial report for the nine months ended on September 30, 2024.
At the same time, plans are afoot for the establishment of an industrial bakery in Saudi Arabia. To this end, a market assessment study has already been finalised by a consultant, while potential shareholders are being lined up to invest in the venture, according to OFM.
Further underscoring its appetite for growth, OFM is weighing a merger with an upcoming industrial bakery specialising in frozen bakery products. “A consulting firm has been engaged to evaluate the potential merger with a major emerging frozen industrial bakery. The firm has completed the strategic fit assessment and is now working on the valuation,” said Al Balushi.
Likewise, in a bid to bolster its already considerable presence in the domestic feed mill sector, OFM subsidiary Atyab Investments has completed the valuation of a major feed mill in the country that has been targeted for acquisition. “Upon agreement of the terms and conditions, Atyab will initiate legal due diligence to proceed with finalisation,” said the chairman.
Another notable target of its acquisition strategy is Oman Bio-Products, a specialised animal feed mill currently under construction at Khazaen Economic City in Barka. OFM, which presently owns a 33-per cent stake in Oman Bio-Products through its subsidiary Atyab Investments, recently announced that it is eyeing a 100-per cent acquisition of the company.
OFM Group, part of Oman Food Investment Holding Company (Nitaj) – an affiliate of Oman Investment Authority (OIA) - recorded total revenues of RO 96.14 million during the nine months ended on September 30, 2024, up from RO 92.63 million for the same period last year.
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