JEDDAH, 15 February 2006 — Savola has said that it is determined to pursue its diversification drive that will turn it into a holding company. “Thus we aim to perform better than in 2005, which ended for us with strong profits,” a senior management executive of the Savola Group said on the sidelines of the Jeddah Economic Forum that concluded on Monday night.
“We plan to float up to 30 percent of our core edible oil business and venture into petrochemicals, real estate and IT,” the group’s Corporate Social Responsibility Manager Mazen H. Radwan told Arab News.
Savola has reported a profit of SR1.2 billion last year. This marks 139 percent higher than the previous year for the food giant. The company is one of the 10 largest firms on the Saudi Stock Market.
Radwan said, the group, which supplies the Middle East and North Africa with edible oils, sugar and dairy products, and owns Azizia Panda supermarkets, would float up to 30-percent of Afia International, its edible oil company. “We’re waiting for government approval to go public. It may take about six months,” he added. Afia has a major share of the Saudi edible oil market. It also operates in Iran, Egypt, Jordan, Kazakhstan, Morocco and Sudan.
“We’ve finalized a reorganization plan and aim to become the most diversified company in the MENA region,” he said, adding that the firm expects to achieve this in the next few years.
Outlining its diversification plan, he said Savola recently moved into petrochemicals in a joint venture with a Chinese firm, acquired Riyadh-based Asharq packaging company and set up a urea plant in Egypt. “We also plan to boost our sugar activity by opening a plant in Egypt, which will be operational by the end of this year,” Radwan added.
Savola claims to supply 80 percent of the Kingdom’s sugar market.
“We’ve also gone into franchising and opened a restaurant of South African chain Mugg & Bean in Jeddah,” Radwan said. The company is exploring the prospects for introducing additional franchises. “We’ll invite many franchises to come and establish themselves,” he said.
The company is also planning to expand its real estate business through is subsidiary, Al-Muttahida, which was launched last year. “We want to expand our Panda chain of supermarkets,” he added. The group owns what is considered the largest retail food chain in the Middle East - the Azizia Panda supermarkets.
One other field Savola continues to explore for investment is the communications and IT sector. “We hope to make investments in this sector in due course,” Radwan said.
The Kingdom’s major industrial company, which supplies the Kingdom, Middle East and North Africa with edible oils, sugar and fresh dairy products, had its stand showcasing its activities in the main lobby of the Hilton Hotel, the venue of the JEF 2006. Savola was also the silver sponsor of the forum.