Arla Foods makes EGP 8.9 billion offer to acquire a majority stake in Domty

EGP 8.9bn is being offered by Arla Foods for a majority stake in dairy firm Domty, Egypt's biggest, as it expands in the MENA region.

Arla Foods have made a non-binding proposal of an offer to acquire majority of shares in the Arabian Food Industries Company, commonly known as Domty, a leading dairy producer in Egypt. The offer values the company at approximately EGP 8.9 billion ($183 million) for 100 percent ownership.

Domty, which employs about 4,000 workers and has two production plants in Egypt, is presently owned by the El Damaty family. It is anticipated that they would keep a portion of the ownership along with Arla, with Mohamed El Damaty retaining his title as CEO. As per Arla’s plan, the company wants to remove Domty from the listing of shares held at the Egyptian exchange after the deal is made.

The offer is subject to satisfactory due diligence by Altanova, definitive documentation and regulatory and corporate approvals.

"Domty being one of the key players in the dairy business in Egypt is also quite big. This fits perfectly into our structure in the region,” said Kim Villadsen, Senior Vice President for MENA at Arla Foods. “We are assessing the position now prior to making a decision focused on the purchase.”

Arla Foods has a long-standing retailing and manufacturing business in the Middle East and North Africa regions, the second largest after Europe. Villadsen stated that growing into Egypt would instead be an easy step in meeting MENA consumers which explicitly depicts the company’s focus on producing and giving consumers high dairy products fitting to the regional needs.