Saudi Arabia’s Almarai is in talks with PepsiCo Inc to increase its stake in a joint venture formed with the US soft drink giant in 2009, the Gulf dairy firm said on Tuesday.
Almarai, the Gulf’s biggest dairy firm by market value, currently holds 48-per cent in International Dairy & Juice Ltd (IDJ), with PepsiCo owning the remaining 52-per cent stake.
The IDJ joint venture was formed to target growth opportunities in the dairy and juice sector in Southeast Asia, Africa and the Middle East, excluding the Gulf region.
“Almarai is looking at possibly slightly increasing their ownership of IDJ,” the company said in a bourse statement.
“It is anticipated that an announcement could be made during the course of March 2012, although discussions are still ongoing.”
Almarai, currently roadshowing for a riyal-denominated Islamic bond, has been keen to expand its footprint outside its core presence in the Gulf. In December, the company acquired Fondomonte S.A which owns and operates farms in Argentina, to secure feed for its dairy herd and poultry businesses.
It plans to invest $1.1 billion in the poultry sector, it said in June. Interest in Saudi Arabia’s consumer sector is growing among international investors as the country’s population rises beyond 27 million.