RIYADH: A takeover bid by dairy firm Almarai Co. for Hadco has gathered more than 50 percent of shareholder votes, clearing a crucial hurdle for what could be the first takeover involving two Saudi listed firms.
Data from the stock exchange showed on Tuesday that more than 52 percent of shareholders in Hadco, also known as Hail Agricultural Development Co., accepted a $253.2 million cash and stock bid by Almarai, the Gulf’s largest dairy firm by market value.
The bid was approved by shareholders holding around 15.73 million shares in Hadco, which exceeds the 50 percent required for the deal to go through.
The deal is crucial for Almarai because it would allow the firm to enter the lucrative poultry business. Almarai had to improve an initial bid it made in November by 35.3 percent.
According to Dubai-based Shuaa Capital, Hadco is the Kingdom’s fourth largest poultry producer.
In addition to being a key domestic player in the poultry business, Hadco produces olives, wheat, dates and grass fodder. Almarai has its own cattle farms.
The two firms have fixed a Nov. 30 deadline for conclusion of the agreement.
Almarai has been diversifying its revenues through acquisitions and has earmarked 6 billion riyals ($1.6 billion) for investments to expand outside the Gulf Arab region.