SALIC acquires stake in Daawat Foods

Saudi Agricultural & Livestock Investment Company (SALIC) has acquired 29.91% stake in Daawat Foods (DFL) from India Agri Business Fund.

Financial details of the acquisition have not been divulged.

SALIC noted that this investment is in line with its strategy in investing in its key commodity, rice. The investment is expected to strengthen its rice supply chain.

DFL is a manufacturing and sourcing unit of LT Foods. Out of the five manufacturing facilities owned by LT Group in India, it accommodates one facility and currently contributes to around 22% of the group’s total production.

It mostly caters to overseas markets and has seen a revenue growth of over 20% over a five-year period.

LT Foods is an 80-year-old company, delivering rice and rice-based food brands in over 80 countries. It has posted consolidated revenue of about $550m as of financial year 2019.

Its flagship brands ‘Daawat’ and ‘Royal’ in India and US are claimed to have a market share of 29% and 45%, respectively.

TradeArabia News Service quoted LT Foods CEO Ashwani Kumar Arora as saying: “Partnership with SALIC will help us to open up and create new opportunities for business in the Middle East besides strengthening our presence there. We also feel that this partnership shall help the Saudi firm strengthen and make supply chain more efficient to and in the region.”

SALIC intends to secure over 50% of the rate of import coverage across all strategic goods compatible with the food security strategy in Saudi Arabia.

The company has grouped 12 essential commodities into three segments: supply chain, production agriculture, and animal protein, and as part of its growth strategy has made several strategic acquisitions and partnerships.

Founded in 2009, SALIC is fully owned by the Saudi Public Investment Fund (PIF). Its activities are primarily in the field of agricultural investment and livestock production.