Agthia, an Abu Dhabi-based food and beverage firm, has acquired BMB Group, a snack manufacturer. This is Agthia's second purchase in the healthy foods area as it strives to extend its range.
The undisclosed value of the purchase is intended to improve Agthia's exposure to the $360 billion global market for healthy snacks and allow the company to considerably extend its reach, according to the company.
“We are delighted about the potential of exploring options to stimulate product innovation, such as the development of new healthy and specialised snacks in response to market trends, in addition to instant access to new revenue streams and markets,” Agthia chief executive Alan Smith said.
BMB produces and distributes a variety of products under the Asateer, Al Qamar, Freakin' Healthy, and Benoit brands. The company, which was founded in 2007, distributes over 2,000 items in over 23 countries throughout the world, including the United Arab Emirates, Saudi Arabia, and the United States.
The company's revenue for the year ended June 30 was Dh268 million, while earnings before interest, taxes, depreciation, and amortisation were Dh54 million. BMB's Ebitda margins are likely to increase by roughly 20% this year, according to Agthia.
The deal will be completely funded with cash and instantly accretive to Agthia's earnings, according to the business.
The transaction is subject to customary closing conditions, which include gaining necessary regulatory approvals.
Agthia, which is controlled by Abu Dhabi's state holding company ADQ, recorded a 17.5% increase in net profit in the second quarter of this year as a result of acquisitions. From the same period a year ago, net income increased to $5 million for the three months ending in June.
In order to become a dominant regional player in the business, the company has made a number of acquisitions in recent months.
Al Faysal Bakery and Sweets in Kuwait, Egypt's Ismailia Investments, Jordan's Nabil Foods, and Al Foah, the world's largest date processing and packaging company, have all been purchased.
Agthia's consumer business's net revenue contribution increased by 20% yearly to Dh855m as a result of the acquisitions, the company announced earlier this year.
Mr Smith told The National earlier this year that the company is looking at a pipeline of potential purchases and is interested in assets in the UAE, the Mena area, Pakistan, and Afghanistan.
Targets outside of these regions could be appealing if the company can locate assets that suit its operations, he said.