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Sohar Poultry Acquired by Atyab-IFFCO JV

by 5m Editor
19 October 2009, at 11:16am

OMAN - Atyab-IFFCO joint venture has bought Sohar Poultry.

Times of Oman reports that Oman Flour Mills' (OFM) investment arm, Atyab Investment, in a 50:50 joint venture with Sharjah-based IFFCO UAE has taken over rival, Sohar Poultry Co.

"The vision and mission of the new company, Atyab-IFFCO Poultry, is to establish one of the largest poultry farm in the entire region. The JV, will invest 25 million rial (OMR), in setting up a new poultry farm in Ibri that would produce 15,000 tonnes of chicken and two million hatching eggs every year," Ali Habaj, CEO of OFM, told the newspaper.

He was unable to give full financial details of the joint-venture agreement yet.

"The acquisition of Sohar Poultry, which has a strong branding and good distribution network, will complement our existing operations," Mr Habaj said.

He said that the Directors of Sohar Poultry Co. have in principle accepted the offer but that the final transaction is subject to approval of the Capital Markets Authority and Muscat Securities Market and other relevant statutory authorities in Oman.

The MSM-listed OFM, which supplies about 65 per cent of the requirements of the flour market in the Sultanate, has been aggressively implementing an action plan to catapult the company into a top regional industry player.

Atyab Investment, OFM's investment arm, is investing $100 million in new ventures that include Atyab Poultry, Atyab Bakery, The Bread House, Atyab Grains International, Sohar Flour Mills, American Institute of Baking (AIB) and Swiss Milling School. Modern Poultry Farms (MPF) is an 86 per cent subsidiary of OFM.

According to Mr Habaj, currently there are only two farms in Oman that produce table eggs: Modern Poultry Farm and Barka Poultry Farm.

"While the total consumption is close to 350 million eggs every year, together the two farms, produce only 200 million eggs every year. The rest is being imported. This miss-match in demand and supply offers us huge prospects," he explained.

IFFCO UAE is one of the largest food companies in the region and currently has emerged as one of the largest livestock owners in the world. "Once the JV project at Ibri becomes operational, we will become the largest poultry producers in the region," Mr Habaj told Times of Oman.

The joint venture expects to become the largest producer of chicken in Oman when the new farm becomes operational in the next two years.

"With a capacity of 15,000 tonnes from the new farm, plus the 6,000 tonnes of chicken from Sohar Poultry Farm, we will overtake A'Saffa as the largest poultry farm in the Sultanate," Mr Habaj pointed out.

The new venture has been promised a 30-square kilometre of land in the first phase to set the farm in Ibri. This area is set to double to 60 square kilometres in the second phase of development.

"We want develop a state-of-the-art farm and the region where it is coming up is ideal for the farm as the area is not that humid. We need such a huge area because of bio-security reason," he said.

The company will commence infrastructure work on the project next year and is expecting to fully commission it in two years time.

"Once the infrastructure is ready the joint venture will work together in branding, distribution channels and combine the resources of the two companies to emerge as the leading poultry farm player in the region," Mr Habaj said.

The new project in Ibri will also produce hatching eggs. "In Oman the current consumption of hatched eggs is 17.5 million per year," said Mr Habaj.